ULIP Riders

Discover the top ULIP riders that provide extra financial security and coverage for your investment portfolio.
Check Life Insurance Policies
3 min
20-May-2025
Unit-Linked Insurance Plans (ULIPs) are a powerful investment tool that combine life insurance with wealth creation. However, to enhance their benefits, insurers offer ULIP riders, which provide additional coverage beyond the basic plan. These riders help policyholders manage financial risks arising from accidents, illnesses, or income loss.

By adding riders to a ULIP, policyholders can ensure their family's financial stability in case of emergencies. Riders like critical illness, accidental death, and premium waiver provide extra security and help in unforeseen situations. Choosing the right riders can maximise benefits, reduce risks, and improve tax efficiency.

Understanding different ULIP riders and their benefits is essential for making an informed decision. This guide will explain various types of ULIP riders, their advantages, and how to choose the most suitable one based on individual needs and financial goals.

What are ULIP riders?

ULIP riders are optional add-ons that enhance the coverage and benefits of a Unit-Linked Insurance Plan. These riders offer additional financial protection in case of accidents, illnesses, or other unforeseen events. They provide a cost-effective way to extend coverage without purchasing a separate policy. Here are the key features of ULIP riders:

Added financial protection for policyholders and their families.

Low-cost coverage enhancements compared to standalone policies.

Flexibility to choose riders based on personal financial goals.

Tax benefits under Sections 80C and 80D of the Income Tax Act.

Lump-sum payouts for medical emergencies, disabilities, or death.

Ensures continuity of investment even if the policyholder cannot pay premiums.

ULIP riders help in reducing financial stress by covering unexpected expenses and ensuring long-term wealth growth. Choosing the right rider can significantly improve the overall benefits of a ULIP policy.

Types of ULIP riders

ULIPs offer different types of riders, each designed to provide specific benefits. Some of the most popular ULIP riders include:

Accidental death cover rider

Provides a lump-sum payout if the policyholder dies due to an accident.

Critical illness rider

Offers financial support if the insured is diagnosed with a critical illness like cancer or heart disease.

Waiver of premium rider

Waives future premiums if the policyholder becomes disabled or critically ill.

Family income benefit rider

Ensures a regular income for the family in case of the policyholder’s death.

Disability rider

Provides financial assistance if the policyholder suffers a permanent disability.

Hospital cash rider

Offers daily cash benefits for hospitalisation due to illness or accident.

Each of these riders enhances financial security and helps policyholders manage risks effectively.

Benefits of choosing the most suitable ULIP riders

Choosing the right riders helps in maximising protection, reducing risks, and securing financial goals.

BenefitDescription
Enhanced coverageRiders offer extra protection beyond the base ULIP policy.
Financial securityProvides lump-sum payouts in case of death, disability, or illness.
Affordable premiumsRiders cost less than buying a separate insurance policy.
Wealth protectionEnsures investment continuity even if premiums cannot be paid.
Tax benefitsPremiums paid for certain riders qualify for tax deductions under Sections 80C and 80D.
CustomisationPolicyholders can select riders based on their financial goals.
Income replacementFamily income benefit riders provide financial stability to dependents.


How to choose the most suitable ULIP riders?

Selecting the right ULIP riders requires careful planning. Consider the following factors before making a decision:

Assess financial goals

Determine your long-term financial needs and choose riders that align with them.

Understand risk factors

If you have a high-risk job or lifestyle, an accidental death or disability rider may be beneficial.

Check tax benefits

Opt for riders that offer tax deductions under Sections 80C and 80D.

Compare costs

Choose riders that offer maximum benefits at a reasonable cost.

Look for flexibility

Ensure the insurer allows you to add or remove riders as your financial situation changes.

Check exclusions

Read the policy terms carefully to understand limitations and exclusions.

Choose reputed insurers

Select riders from well-known insurers with good claim settlement ratios.

A well-chosen ULIP rider can provide long-term financial security, investment continuity, and tax efficiency.

Conclusion

ULIP riders are an essential tool to enhance financial security while investing in a ULIP policy. They offer added protection in case of unforeseen events like accidents, illnesses, or income loss. Choosing the right riders helps policyholders secure their wealth, protect their family, and ensure investment continuity.

Understanding different ULIP riders, their benefits, and how to choose the best one is crucial for maximising financial gains. Riders like critical illness, accidental death, and premium waiver can significantly reduce financial risks and ensure long-term stability.

For Indian investors, selecting the right ULIP riders can help in wealth creation, tax planning, and securing a financially independent future. Comparing available options and choosing wisely can make a substantial difference in the overall benefits of a ULIP policy.

Frequently asked questions

What illnesses are covered under the critical illness rider?
A critical illness rider covers life-threatening diseases like cancer, heart attack, stroke, kidney failure, major organ transplants, paralysis, and multiple sclerosis. The exact list varies by insurer. On diagnosis, a lump-sum payout is provided to manage medical expenses, ensuring financial stability during treatment and recovery.

What is the cost of adding a ULIP rider?
The cost of a ULIP rider depends on factors like age, health condition, sum assured, and type of rider. Generally, rider premiums are 1-5% of the base ULIP premium. While they increase overall policy costs, they provide enhanced financial protection at a lower cost than standalone policies.

How does the income benefit rider help my family?
An income benefit rider provides regular payouts to the policyholder’s family if they pass away or become permanently disabled. This ensures financial security by replacing lost income, covering essential expenses like household costs, education, and medical needs, offering long-term stability during difficult times.

Show More Show Less

Bajaj Finserv App for All Your Financial Needs and Goals

Trusted by 50 million+ customers in India, Bajaj Finserv App is a one-stop solution for all your financial needs and goals.

You can use the Bajaj Finserv App to:

Apply for loans online, such as Instant Personal Loan, Home Loan, Business Loan, Gold Loan, and more.

Explore and apply for co-branded credit cards online.

Invest in fixed deposits and mutual funds on the app.

Choose from multiple insurance for your health, motor and even pocket insurance, from various insurance providers.

Pay and manage your bills and recharges using the BBPS platform. Use Bajaj Pay and Bajaj Wallet for quick and simple money transfers and transactions.

Apply for Insta EMI Card and get a pre-approved limit on the app. Explore over 1 million products on the app that can be purchased from a partner store on No Cost EMIs.

Shop from over 100+ brand partners that offer a diverse range of products and services.

Use specialised tools like EMI calculators, SIP Calculators

Check your credit score, download loan statements and even get quick customer support—all on the app.

Download the Bajaj Finserv App today and experience the convenience of managing your finances on one app.

Do more with the Bajaj Finserv App!

UPI, Wallet, Loans, Investments, Cards, Shopping and more

Disclaimer

*T&C Apply - Bajaj Finance Limited (‘BFL’) is a registered corporate agent of third party insurance products of Bajaj Allianz Life Insurance Company Limited, HDFC Life Insurance Company Limited, Life Insurance Corporation of India (LIC), Bajaj Allianz General Insurance Company Limited, SBI General Insurance Company Limited, ACKO General Insurance Company Limited, HDFC ERGO General Insurance Company, TATA AIG General Insurance Company Limited, ICICI Lombard General Insurance Company Limited, New India Assurance Limited, Chola MS General Insurance Company Limited, Zurich Kotak General Insurance Co. Limited , Star Health & Allied Insurance Co. Limited, Care Health Insurance Company Limited, Niva Bupa Health Insurance Company Limited , Aditya Birla Health Insurance Company Limited and Manipal Cigna Health Insurance Company Limitedunder the IRDAI composite CA registration number CA0101. Please note that, BFL does not underwrite the risk or act as an insurer. Your purchase of an insurance product is purely on a voluntary basis after your exercise of an independent due diligence on the suitability, viability of any insurance product. Any decision to purchase insurance product is solely at your own risk and responsibility and BFL shall not be liable for any loss or damage that any person may suffer, whether directly or indirectly. Please refer insurer's website for Policy Wordings. For more details on risk factors, terms and conditions and exclusions please read the product sales brochure carefully before concluding a sale. Tax benefits applicable if any, will be as per the prevailing tax laws. Tax laws are subject to change. BFL does NOT provide Tax/Investment advisory services. Please consult your advisors before proceeding to purchase an insurance product. Visitors are hereby informed that their information submitted on the website may also be shared with insurers. BFL is also a distributor of other third-party products from Assistance Services providers such as CPP Assistance Services Pvt. Ltd., Bajaj Finserv Health Ltd. etc. All product information such as premium, benefits, exclusions, sum insured, value added services, etc. are authentic and solely based on the information received from the respective insurance company or the respective Assistance service provider company.

Note – While we have made all efforts and taken utmost care in gathering precise information about the products, features, benefits, etc. However, BFL cannot be held liable for any direct or indirect damage/loss. We request our customers to conduct their research about these products and refer to the respective product’s sales brochures before concluding their sale.

Show All Text