Term Insurance 3756 views March 18, 2020

Best Term Insurance Plan with Critical Illness Rider

Term plans are the simplest and cost-effective insurance plans. Term plans ensure to pay the sum assured to the insured’s family on the death of the insured during the term of the policy. However, no maturity benefits are paid under term insurance plans as they are a pure-protection insurance policy. Term insurance plans offer a wide range of enhanced protection options. One such option is Critical Illness Rider. If you want to increase the coverage of your insurance plan then you can add critical illness rider with your term plan by paying an additional amount of premium.

Term Insurance

To know the right life insurance cover, please fill the details below and our policy experts will get in touch with you


Critical Illness Rider

Critical Illness Rider is an add-on benefit which can be added to a term insurance plan to increase its coverage. Critical illness rider provides protection to the insured by paying out the sum assured in the plan in the lump-sum amount on diagnosis of covered critical illness.
They generally included illnesses are cancer, heart failure, paralysis, major organ transplant, lung disease, kidney failure, heart attack and many others.

Features of Term Plan with Critical Illness Rider

The features of a term plan with critical illness rider are as follows:

Additional Premium

If you buy a critical illness rider on a term insurance plan then you will have to pay an additional premium for the rider benefit. It provides higher coverage in low additional premiums and the amount of premium to be paid remains the same throughout the policy term which means the premium will not increase on the diagnosis of a critical illness. Some insurance companies also waive off the payment of future premiums if the insured is diagnosed with a critical illness.

Sum assured

The sum assured in a critical illness rider is limited. Usually, an equal sum assured in critical illness rider is allowed as in the base term insurance plan. However, if the sum assured in the base term plan is higher than the maximum sum assured in the critical illness rider the rider’s coverage amount would be limited.

Maturity Benefit

Term plan with critical illness rider do not have any maturity benefit. If the insured survives during the term of the plan and is not diagnosed with any critical illness, no benefit will be paid on maturity.

Critical Illness Benefit

If the insured is diagnosed with any of the covered critical illness then the sum assured in the critical illness rider will be paid as a lump-sum benefit and the rider benefit will be terminated. However, the term insurance plan will continue.

Waiting Period

Critical Illness Riders have a waiting period of 30 days after the diagnosis of a covered critical during which the insured individual has to survive to receive the claim. Further, there is also a waiting period of 90 days at the starting of the policy. Any death within 30 days of the diagnosis of critical illness or any critical illness diagnosis within the first 90 days of the start of the rider will not be covered.

Benefits of Term Plan with Critical Illness Rider

One must opt for a critical illness rider as an add- on with a term insurance plan as it offers numerous benefits and financial support in the time of need. The benefits of a Term plan with critical illness rider are as follows:

  1. The Term plan with critical illness rider provides dual coverage of term insurance and critical illness benefit.
  2. In small premiums, higher critical illness is covered thereby insuring higher coverage and benefit.
  3. Critical illness benefit enables the insured to opt for better treatment process which may not be possible due to limited finance. However, critical illness rider pays benefits upon diagnosis of the critical illness which provides financial support for paying the huge treatment cost.
  4. The lump-sum amount received under a critical illness rider can be used for any financial requirement as there is no limitation for the use of critical illness benefit. The insured can use the benefit for paying off the loans, EMI or daily expenses.
  5. The premiums paid toward the term insurance plan can be availed as a deduction up to a maximum of 1.5 lacs under section 80C of the Income Tax Act. Also, the death benefit received under the term insurance plan is exempted from tax under section 10(10D) of the Income Tax Act.


At the time of Critical illness, one may dry out from finances in an unexpected way as critical illness can come anytime without a warning. According to the current scenario and lifestyle of people, chances of critical illness are increasing day by day. Hence it is advisable to buy a critical illness rider as an add-on with term insurance for ensuring financial support and cover treatment cost on the diagnosis of any critical illness. The term plan with critical illness rider is best for those who want dual benefit but cannot afford the high premium cost to buy critical illness as a standalone policy.

People Also Read