Overview

The LIC Accident Benefit Rider is an optional add-on that you can attach to an eligible life insurance policy from the insurer. 

Key Features and Benefits

  • Additional Death Benefit: If death occurs within 180 days of the accident, the nominees receive the rider sum assured in addition to the main policy’s death benefit. 
  • Tax Benefit: Payments toward rider premiums qualify for tax deductions under Section 80C (now renamed Section 123) of the Income Tax Act if you opt for the old regime.

Eligibility Criteria

  • Entry Age: 18 to 65 years.
  • Maturity Age: Maximum 70 years.
  • Sum Assured: ₹20,000 to ₹1 crore (across all LIC policies, ₹2 crore with LIC’s Jeevan Shiromani).
  • Rider Term: Premium Payment Term (PPT) of the base plan or 70 minus age at entry, whichever is earlier. 

The Ministry of Road Transport and Highways recorded 1,77,177 road accident deaths in India in 2024, which accounts for nearly 20 deaths every hour. Add in accidents at home or at work, and a standard life cover payout can start to feel thin for a family that suddenly loses its breadwinner.

This is the gap the LIC’s accident benefit rider fills. In this article, we cover what the rider is, its features, eligibility, sum assured and premium rates, payout structure, and exclusions.

Confused about whether to opt for the LIC accident benefit rider or choose a higher base cover? Book a call or chat on WhatsApp with Ditto’s advisors now. 

What Is the LIC Accident Benefit Rider?

LIC's Accident Benefit Rider (UIN: 512B203V03) is a non-linked individual rider attached to eligible LIC plans, such as the LIC New Endowment Plan, Bima Lakshmi, or Bima Kavach. 

If the life assured dies within 180 days of the accident, LIC pays the Accident Benefit Sum Assured (ABSA) to the nominee. The insurer defines an accident as a sudden, unforeseen, and involuntary event caused by external, violent, and visible means. 

Note: The current version of the rider took effect on October 1, 2024, replacing the older version.

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Key Features of LIC Accident Benefit Rider

01

Flexible Addition

Can be added at policy inception or later, provided both the base policy and rider have at least 5 years of outstanding Premium Payment Term (PPT).

02

Extended Coverage

Protection continues until age 70 or the end of the base plan's PPT, whichever is earlier.

03

Pure Protection Rider

Offers no maturity or surrender value, as it is solely a risk protection cover.

04

Premium Payment

Rider premium is collected along with the base policy premium for added convenience.

05

Police Duty Option

Available at a higher premium (to compensate for the higher occupational risk) of ₹1 per ₹1,000 of sum assured, for eligible non-administrative police duty in a police organization other than a paramilitary force.

Eligibility Criteria & Age Limits

Entry Age

18 to 65 years.

Maximum Maturity Age (Cover Ceasing Age)

70 years.

Rider Term

The rider remains in force for the premium payment term of the base policy or until the policyholder reaches 70 years of age, whichever occurs first.

Premium Payment Mode

Same as base plan.

Sum Assured, Premium Rates, & Payout Structure

    • Minimum Accident Benefit Sum Assured (ABSA): ₹20,000, in multiples of ₹5,000.
    • Maximum ABSA: Subject to the limit specified under the eligible base plan and LIC’s aggregate cap of ₹1 crore across most policies. The aggregate cap can extend to ₹2 crore if you hold LIC’s Jeevan Shiromani with a minimum sum assured of ₹1 crore.
    • Premium Rate: ₹0.50 per ₹1,000 ABSA a year (₹1.00 with the police duty extension).
    • Payout: A lump sum equal to the ABSA, paid only if accidental death occurs within 180 days of the accident.

For example, for an ABSA of ₹1 crore, your annual premium will be ₹5,000 (or ₹10,000 with the police duty extension), and for an ABSA of ₹2 crore, it will be ₹10,000 (or ₹20,000 with the police duty extension). 

Exclusions Under the LIC Accident Benefit Rider

LIC will not pay the ABSA if death is caused by intentional self-injury, attempted suicide, insanity, immorality, or intoxication. In addition, the benefit is excluded if death results from war, riots, or civil commotion, or if it occurs while the insured is hunting, mountaineering, racing, or participating in other adventurous sports. Furthermore, the ABSA does not apply if death results from a criminal act or arises during armed forces or police duty, unless the police duty extension was opted for. 

Note: Active police-duty accidents are normally excluded from the standard rate. To remove this exclusion, you must explicitly opt in for the police duty cover and pay the higher premium.

Should You Buy the LIC Accident Benefit Rider?

At Ditto, we don't recommend opting for this rider. The reason is simple. A standard term insurance policy already pays the full sum assured, regardless of whether death occurs due to illness or accident. 

So, instead of paying extra for a rider that only covers accidental death, it's usually better to increase your base sum assured. That way, your family gets a higher payout no matter what causes your death. In most cases, a higher base cover offers broader and better value than an accidental death rider.

However, the rider can be considered a low-cost supplementary benefit for buyers with higher accident exposure, who cannot increase the base cover economically, or who have restrictions on base cover due to income or age. 

If you’re confused about which riders to opt for, you can use the following infographic for reference:

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LIC Accident Benefit Rider
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You can book a FREE consultation. Slots are running out, so make sure you book a call or chat on WhatsApp now!

Conclusion

The LIC accident benefit rider is inexpensive, but its coverage is narrow. It pays only when an accident independently causes death within 180 days and provides no benefit for disability, survival, or surrender. Because of these limitations, it works best as a supplement rather than a substitute for comprehensive life insurance. 

For most families, adequate term insurance should remain the priority because it covers death regardless of the cause. If you prefer the insurer, you can choose their LIC term insurance plans. 

Frequently Asked Questions

Is the LIC Accident Benefit Rider better than a standalone personal accident cover?

A standalone Personal Accident (PA) cover is generally considered better and more comprehensive than the LIC Accident Benefit Rider. While the LIC rider is an affordable add-on, a standalone policy offers broader coverage, higher sum insured limits, and protection against a wider range of disabilities, injuries and loss of income.

Is the LIC term rider benefit the same as the LIC accident benefit rider?

The LIC term rider refers to LIC’s New Term Assurance Rider (UIN: 512B210V02), which provides life cover in the event of the policyholder's unfortunate death due to illness or accident during the policy term. You can get a sum assured between ₹1 lakh and ₹25 lakh. On the other hand, LIC’s accident benefit rider only provides the sum assured if death occurs due to an accident. You can get a sum assured between ₹20,000 and ₹1 crore (₹2 crore if you hold LIC’s Jeevan Shiromani).

Can I add the LIC Accident Benefit Rider after buying my base LIC policy?

The rider can be added later only if the base policy permits it. Under the general rider conditions, at least five years of premium-paying term must remain, and the addition must ordinarily take place before the 65th birthday. However, individual plans can impose stricter limits. For example, Bima Lakshmi applies a limit of 60. Finally, LIC will approve the request in accordance with its prevailing eligibility and underwriting rules. The rider is available only with eligible regular-premium policies and cannot be purchased separately.

Does the LIC Accident Benefit Rider cover permanent disability or only accidental death?

It covers only accidental death. It does not pay for permanent total disability, permanent partial disability, temporary disability, hospitalization, or loss of income following an accident. However, LIC offers an Accidental Death and Disability Benefit Rider separately.

Is the premium paid for the LIC Accident Benefit Rider eligible for a tax deduction?

Yes. The rider premium may be included with the base policy premium for a deduction under Section 123 of the Income-tax Act, 2025, corresponding to the former Section 80C. However, this deduction is available only under the old tax regime. For policies issued on or after April 1, 2012, the eligible premium is capped at 10% of the base policy’s actual capital sum assured. This is also subject to the overall ₹1.5 lakh annual limit that applies to all eligible investments and payments under the section.

Does the LIC Accident Benefit Rider pay out if death occurs months after the accident?

Yes, but death must occur within 180 days of the accident. The accidental injury must also be the sole, direct, and independent cause of death. Importantly, the rider must be in force on the date of the accident, although it need not remain in force until the date of death. Any rider premiums falling due after the accident and up to the policy anniversary following death may be deducted from the payable rider benefit.

What happens to the LIC Accident Benefit Rider if I stop paying the base policy premium?

The rider cannot continue independently. Its grace period is the same as that of the base policy. If the base policy lapses or is converted into a paid-up policy, the rider cover ceases because it does not acquire any paid-up value. If you’d like to revive the rider, you can do so only with the base policy, subject to LIC’s revival and underwriting requirements.

What is LIC’s Accidental Death and Disability Benefit Rider?

LIC’s Accidental Death and Disability Benefit Rider is an optional add-on that provides financial support if the insured suffers an accident resulting in death or permanent total disability within 180 days. In case of accidental death, the Accident Benefit Sum Assured (ABSA) is paid as a lump sum. In case of permanent total disability, the same amount is paid in equal monthly installments over 10 years, and eligible future premiums are waived. The rider is available with eligible base policies up to the policy term or age 70, whichever is earlier.

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