My cousin has suggested that I go for a critical illness rider with a life insurance policy. How does this rider work?
Veeresh Dua, Bhopal
The critical illness rider attached with a life insurance policy provides coverage in the event of a critical illness such as heart attack, stroke or cancer, as mentioned in the list of critical illnesses that the rider covers. In case you contact with any critical illness, the policy pays out the sum assured under the critical illness on its diagnosis. The illnesses covered and the premiums vary across insurers, which makes it important for you to check the illnesses covered by different insurers before considering a policy. For instance, some insurers exclude critical illnesses that may have been caused by the existence of pre-existing ailments. Also, the point worth noting is that few insurers terminate the base policy once a claim is made on the rider. Typically, the rider gets terminated if the critical illness is diagnosed to be terminal in nature.
