One of the best things to happen to insurance-seekers post-privatisation is the freedom to attach riders to their life insurance policies that provide some add-on benefits in case of eventualities.

One such rider that can be attached to the life insurance policy is DSA (Double Sum Assured), which provides an additional sum assured to the survivors in case of death of the policyholder. So if there is an endowment policy of Rs 200,000 with a DSA rider and the policyholder dies within the policy term, his nominee will be entitled to collect Rs 400,000 and not just Rs 200,000. However, if the policyholder survives till maturity he will receive only Rs 200,000.

In most cases, the policyholder is the breadwinner of the family and is aware of how to manage the funds. However, in his absence, his survivors may or may not have the expertise to manage funds. In fact, they are likely to need more money to manage funds in the breadwinner’s absence. The DSA rider comes to the rescue of the survivors by providing an additional sum assured to them in case if the policyholder dies during the policy period.

Secondly, there may be some unforeseen expenses that need to be taken care of, or some liabilities to be cleared of in case the policyholder is no more. The DSA benefit provides the extra cushion to the survivors to take care of any such expenses and to retain more in case if the policyholder is no more.

Some insurers also offer the TSA benefit (Triple Sum Assured) but DSA is the more common rider offered by practically all the private players. Whereas the DSA provides one additional sum assured (Rs 400,000 instead of Rs 200,000) to the survivors, the TSA provides two additional sum assured (Rs 600,000 instead of Rs 200,000) to the survivors in case of the policyholder’s death.

The DSA rider is important as the policyholder by taking this rider can be sure that for a policy of ‘x’ amount, the risk covered is ‘2x’. In other words, just by paying a little extra premium the policyholder’s life cover can be doubled. This rider is a must for those who would like to increase their life cover at a nominal cost, rather than go for a larger endowment policy of that amount.

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