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Life is full of uncertainties, and we may not be in the same circumstances tomorrow that we are in today. This is why a majority of us believe in planning our lives to a great degree. The better we plan today, the better we will be able to secure the future of our loved ones. Therefore, buying term life insurance is an important part of our planning. Once you have term insurance plans, you can rest assured that your family will not have to go through any rough patch, even when you are not there with them.
As you buy a term insurance plan, you will also be able to come across and include various riders. One of the most sought-after riders which also proves to be very beneficial for the family of the policyholder is the Income Benefit Rider. When you buy an Income Benefit Rider, and you pass away all of a sudden, your family will keep receiving installments, which may help them as regular income.
Income Benefit Rider, also sometimes called a family income policy is one of the riders in term insurance. This remains effective for a certain period. If you die within the term plan, the nominees are offered a death benefit. If you live throughout the period, the policy will terminate and you will not get any benefit. The death benefit upon the death of the rider is paid out periodically. While buying the policy, you will be able to choose the tenure of the plan and accordingly, the premium will be decided by the insurer.
The best time to add this rider is the period when you buy the policy. In case, you could not add the rider while buying your term insurance policy, you can do it later. This will assure you that even if something unfortunate happens to you, the rider will help your family to carry on with the finances without compromising on anything.
Some of the documents that you would be required to submit for the Income Benefit Rider Claim are mentioned herein below:
Under the Income Benefit Rider, there are some exclusions, such as
In case you are still confused if you should buy an Income Benefit Rider or not, here are some of its benefits that might convince you. Keep reading to understand these.
Upon an untimely demise of the policyholder, the nominees are provided payout in the form of regular installments. Also, this happens when the unfortunate incident takes place within the coverage period. The numbers of installments are pre-decided. This way, the family of the policyholder gets financial support during their challenging times. The Income Benefit Rider can act as a substitute for a monthly income for the family of the policyholder in his/her absence.
Financial stability is important for all of us. However, when the sole breadwinner of the family passes away all of a sudden, the family may face several financial hardships. This is when this term insurance rider helps as a monthly income. They will at least not have to worry about paying the bills. The policyholder can also rest assured that in their absence, their family will have financial stability.
As you buy an Income Benefit Rider, you will not have to put your money into buying another policy. It will be effective as long as the term insurance policy is active.
Under Section 80D, 80C, and Section 10(10D) of the Income Tax Act,1961, you can avail of tax benefits for the premiums you pay for the term plan and the rider. This means, along with the term insurance tax benefit, you will also get additional tax benefits on the rider.
To get the benefits and quick claims processing, you should only go for the best term insurance plan. To browse through some of the best term insurance policies in India, you can visit certain websites where you can find many term plans. You can take your time and compare the policies and then choose the one that suits your needs perfectly.
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