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A Waiver of Premium is a form of a rider that is attached to a life insurance policy, which ensures that the Policy continues to remain in place incase there is a loss of income by the policyholder. These are the premiums that are mostly used in life insurance so that the policy completely matures and is available to the survivors when the Policyholder experiences loss of death. There are other aspects of the waiver of premium where it is expanded into areas of physical disability and related eventualities suffered by the policyholder which makes him unable to pay for the policy premiums.
Sometimes a waiver of premium is automatically included in a separate clause that adds it, however, in many other instances there are additional Riders that need to be added. There is an additional fee that requires the inclusion of this rider. However, for individuals who consider this feature important, it is imperative that they talk to an expert and get their options in getting the clause added.
If someone has opted for a waiver of premium, it implies that they can stop making payment for the premium, in the event of loss of income or any other factors of disability, on which the waiver is set to work. This could be a temporary loss or even a permanent loss. It could be due to the following reasons:
Although there are quite a few restrictions such as age limits, physical conditions and more that could restrict the usage of a waiver of premium, it is important to note that the inclusion of one is as equally important as taking up a long Term policy.
In a few instances, the policy might require that the policyholder be above a certain period of age, or even in a few instances it might require a physical exam to confirm the fitness of the policyholder. All these factors are required to determine the financial stability of the policyholder and understand that there are no restrictions that come into play when paying up premium for the policy chosen. An example would be that the policyholder should lose at least six months of income to apply for a waiver.
This rider helps the policyholders to take advantage of various benefits in the event of a catastrophe or more. Should there be a life insurance, the waiver of premium is essential as there are quite a few restrictions such as the policyholder dying out for the rest of the survivors to enjoy the benefit.
With the aid of a waiver of premium, policyholders can be fully aware and conscious of the fact that they are Assured of prime benefits that come to their rescue.