LIC’s Accidental Death and Disability Benefit Rider
Accidental death and disability are very common possibilities in today’s fast-paced life. Both of these contingencies result in substantial financial loss and so LIC offers an Accidental Death and Disability Benefit Rider which covers these two contingencies. The rider pays a benefit in case of accidental death or disability suffered by the insured during the term of the policy. Here are the salient features of the rider –
- The rider can be taken with a base policy either when buying the policy or during the term of the policy at any policy anniversary
- If the rider is being bought during the policy tenure, the remaining premium payment term should be at least 5 years and the insured should not attain 70 years within such five years
- The rider’s sum assured can be taken equal to the sum assured of the base policy
- The maximum sum assured which the rider allows is up to INR 1 crore which increases to INR 2 crores if LIC’s Jeevan Shiromani Plan is bought.
Benefits paid by the rider
In case of accidental death
If the insured dies due to an accident during the policy tenure, the rider sum assured would be paid along with the death benefit of the base policy
In case of disability
If the insured suffers from a total and permanent disability due to an accident, the following benefits would be paid –
- The rider sum assured would be paid in equated monthly instalments over a period of 10 years. If the policy tenure ends or the insured dies during the payout period of 10 years, the remaining instalments would be paid in lump sum along with the maturity or death benefit paid under the plan
- The future premiums of the policy would be waived but the plan would continue
Total and permanent disability would be said to occur if the insured is unable to perform any four of the following tasks of daily life –
- Put on and take off all his clothes
- Keep up even with the lowest level of personal hygiene
- Eat food from the serving plate
- Use the toilet
- Move around short distances even within the house
- Sit on a chair from the bed or vice versa
For both these benefits to be payable, the accident should be ‘a sudden, unforeseen and involuntary event caused by external, violent and visible means’ and death or disability should occur within 180 days of such accident.
Exclusions under LIC’s Death and Disability Benefit Rider
Death or disability suffered due to the following instances would not be covered by the rider and no rider benefits would be paid in such situations –
- If the injury is self-inflicted
- There has been an attempted suicide.
- The accident has been because of some mental imbalance due to insanity or even intoxication such as alcohol, narcotics or drugs.
- The insured participated in riots, civil rebellion, declared or undeclared war or an adventure sport such as paragliding, bungee-jumping, river rafting, mountaineering, racing etc.
- While he was engaged in an illegal act with a criminal intention such as robbing, stealing or any other anti-social activity.
- If the disability or death has risen from services in the Military. However, the exclusion will not be valid if the insured individual was not on duty or was fighting a natural calamity in his country.
- If the disability or death occurred because of engaging in police services t
- If the insured dies after 180 days of the accident taking place
The rider, independently, has no paid-up value or surrender value. However, if the base policy, to which the rider is attached, is surrendered, the rider premium charged for continuing the cover would be refunded. Refund would be allowed if the base policy was not a regular premium policy and according to the following calculations –
|For single premium plans
|For limited premium plans
|90% of rider single premium * (outstanding term of rider coverage / total policy tenure of rider coverage)
|If the policy is surrendered during the premium payment term – 80% of (rider premium per INR 1000 rider sum assured – 1) * (Rider sum assured / 1000) * (Number of years for which rider premium has been paid)
|If the policy is surrendered after the completion of the premium paying tenure – 80% of (rider premium per INR 1000 rider sum assured – 1) * (Rider sum assured / 1000) * (Premium paying term for the rider) * (outstanding rider term / total rider term – premium paying term for the rider)
Under Section 80C of the Income Tax Act, the premiums that are paid towards the rider are tax deductible up to INR 1.5 lakhs and the death benefit that is received is fully tax-exempted under Section 10 (10D).
Documents Required to Make the claim for LIC’s Accidental Death and Disability Benefit
In the event of a claim under the rider, the following documents should be submitted to receive the claim amount quickly and conveniently.
- Certified copies of FIR and police inquest report
- Copy of panchnama
- Report of the insured’s post mortem
- Newspaper cutting showing the report of the accident
- If the accident happened when the insured was driving then the Driver’s License
- Final verdict by the Sub-Divisional Magistrate
- Treatment records in case there was hospitalisation after the accident.
In case of accidents due to other causes where police FIR is not required, eye witness report, attending physician’s report, affidavit of gram sevak or Government officials, etc. might be required
LIC’s Accidental Death and Disability Benefit Rider helps the insured individual as well as his family to deal with this difficult situation in a better way. By paying a minimal amount this rider can be added on to the basic policy.
Yes, the minimum age is 18 years.
Under Section 80 C of the Income Tax Act, the premiums that are paid towards the rider is tax deductible and the death benefit that is received is tax-exempted under Section 10 (10D).
Provided that the base policy is still in force and the insured individual is below 70 and there are still 5 years of outstanding premiums of the base policy, the rider can be attached at any time.
The minimum sum assured is INR 1 lakh whereas the maximum sum assured is INR 25 lakhs.
The rider is a pure term rider and offers no maturity amount.