Compare & Buy Term Insurance with Critical Illness Rider on Pluto

Jump to a section

What is a Critical Illness Rider in Term Insurance?

A critical illness rider in term insurance adds an extra layer of financial security when a serious health condition disrupts your life. Available as an optional add-on in your term insurance policy, it provides a lump-sum payout if you are diagnosed with a covered illness, such as cancer, kidney failure or a heart attack, subject to policy terms. Unlike standard life cover, which offers a death benefit, this rider offers financial support while you are alive. However, covered illnesses, waiting periods and payout conditions vary across insurers, so compare policies carefully.

How Does Term Insurance with Critical Illness Benefit Work?

Term insurance with a critical illness benefit provides financial protection against both the loss of life and the financial impact of a serious illness. Here’s how the process works, from purchasing the rider to receiving the payout:

Add Critical Illness Rider in Term Insurance

You can add the critical illness rider to your base term insurance plan while purchasing with an additional premium. Afterwards, you have to serve the initial waiting period, often 90 days from the policy start, to activate the policy.

Get Diagnosed and Serve the Survival Period

Once diagnosed with the covered illness, the policyholder has to contact the insurer with a formal diagnosis report. While the insurer assesses the claim, the policyholder has to live through a required survival period, usually up to 30 days post-diagnosis.

Receive the Payout

After the survival period ends, the policyholder will get the fixed lump-sum amount in their bank account. They can flexibly use this amount for medical expenses, household costs, debt payment and other financial requirements.

How to Compare Critical Illness Cover in Term Plans?

To choose the right term insurance plan with a critical illness benefit, you must compare the following factors as discussed in the table below.

Serial No	Factor	Why Is It Essential
1.	Number of Covered Illnesses	You must ensure the policy covers a wide range of critical illnesses that align with your requirements.
2.	Lump Sum Payout Structure	While purchasing the add-on, verify whether the lump-sum payout is deducted from your base life cover or has an additional payout structure that keeps the base sum assured the same.
3.	Coverage Amount	Considering the rising medical expenses in India, ensure your critical illness rider comes with a coverage of at least ₹25 lakh to cover the expenses.
4.	Waiting Period Clause	In most cases, insurers apply a 90-day waiting period on the critical illness rider. Thus, while purchasing a term plan with this cover, ensure it does not exceed this limit.
5.	Survival Period Terms	Since this period determines how quickly you can claim the payout, choose a term plan with a critical illness rider where the survival period ranges from 14 to 30 days.
6.	Claim Settlement Support	You should always choose an insurer with a strong claim settlement ratio to get hassle-free claim settlement during emergencies.

Who Should Buy Term Insurance with a Critical Illness Rider?

The suitability of critical illness benefit in term insurance depends on your health, financial responsibilities and lifestyle. Here are some situations where this additional protection is worth considering:

If You Have a History of Critical Illness

Since certain critical illnesses, such as cancer and kidney disease, may have a genetic link, having a family history of these conditions makes financial preparedness especially important. A critical illness insurance policy can help cover substantial medical expenses, reducing the financial burden.

Benefits of Term Insurance with Critical Illness Rider

If you are wondering why buying term insurance with a critical illness rider is beneficial, have a look at the section below.

Provides Income Replacement

During the recovery period, policyholders generally need to take a break from work. This is when the lump-sum benefit bridges the income gap for everyday expenses, helping your family to maintain a decent standard of living.

Protection from Medical Inflation

Secures Your Savings

Same Premium Amount

Additional Tax Benefit

Diseases Covered by Term Insurance with Critical Illness Rider

Even though the exact list of illnesses can vary across providers, most term insurance plans with a critical illness rider available at Pluto Insurance cover the following conditions.

Brain and Neurological Conditions

Under a term plan with a critical illness benefit, you will get coverage for different types of neurological conditions. It mainly includes Alzheimer's disease, stroke, brain tumour, Parkinson's disease, multiple sclerosis, and encephalitis.

Cardiovascular Conditions

Critical illness riders may cover cardiovascular conditions such as myocardial infarction (heart attack) and primary pulmonary hypertension. In fact, certain plans may also provide coverage for major procedures, including heart transplantation and open-heart surgery.

Multiple Types of Cancer

A critical illness rider generally covers multiple types of cancer, such as lung cancer or breast cancer. Moreover, some policies may include cancer-related conditions, like bone marrow transplantation.

Respiratory and Liver Conditions

Many term insurance plans with a critical illness rider cover liver and lung disorders, such as end-stage lung failure and chronic liver cirrhosis. Additionally, lung and liver transplantation can also be covered in the policy.

Other Critical Conditions

Along with diseases and procedures, life-threatening conditions such as multiple sclerosis, serious head trauma, major burns or aorta-related surgery can be covered in this rider, based on your policy terms and conditions.

What Does a Term Insurance Policy with a Critical Illness Rider Not Cover?

A term insurance with a critical illness rider will not provide the lump-sum payout benefit under the following circumstances.

Pre-Existing Diseases
For chronic health conditions or symptoms exhibited before buying the policy, critical illness coverage will not be provided.
Death Before Survival Period
If the policyholder dies before the end of their survival period, their family can only get the standard death benefit, not the critical illness lump sum.
Medically Not Necessary Treatments
Surgeries or treatments related to cosmetic enhancement, dental disorders and fertility or serious pregnancy-related complications are not a part of this policy rider.
Sexually Transmitted Diseases
Most insurers do not provide coverage for chronic sexually transmitted disorders, such as HIV or AIDS.

What are the Eligibility Criteria of a Critical Illness Rider?

While the eligibility criteria are the same across most providers, you must check your insurer’s policy wording to verify any specific terms. To buy term insurance with a critical illness rider via Pluto Insurance, you have to meet the following criteria.

Eligibility Criteria	Feature
Age Limit	18 years to 65 years
Nationality	Indian residents are generally eligible to purchase the policy. However, certain insurers also offer term plans with a critical illness rider to NRIs.
Medical Screening	Some insurers may require you to undergo a medical screening before issuing the policy.

Frequently Asked Questions on Term Insurance with critical Illness

Can I add a critical illness rider after buying term insurance?

No, you generally cannot add a critical illness rider to an existing term insurance policy after you have already bought it. This is because most insurers require riders to be selected at the initial underwriting and policy issuance stage.

What documents would I need to claim the benefits of a critical illness rider?

To claim the benefits of a critical illness rider, you generally need a completed claim form, a specialist diagnosis certificate, detailed medical and hospital records and bank proofs as required by your insurer.

What is the difference between a critical illness rider and an accidental death rider?

The main difference between these riders is based on the coverage. While the critical illness rider offers a lump-sum benefit upon the diagnosis of a chronic illness, the accidental death rider provides a payout if the policyholder dies in an accident.

Can I claim a critical illness rider more than once?

No, you generally can not claim the benefit of the critical illness rider more than once. However, if you have purchased the same critical illness rider from different insurers, making multiple claims may be possible as per the insurer’s policy terms.

Can I claim a critical illness rider if I am treated outside India?

If your term insurance with a critical illness rider does not have a geographical limit, you can claim the benefits outside India. However, since not all insurers allow international coverage, read your policy wording carefully to understand the clauses on the geographical limit.

Term Insurance with Critical Illness Rider