Texas General Lines — Life, Accident, Health and HMOLife InsuranceEasy
A life insurance policyowner wants to ensure that if they are unable to pay premiums due to severe disability, the policy will remain in force without requiring further premium payments. Which rider would they add to their policy?
- AWaiver of Premium Rider
- BGuaranteed Insurability Rider
- CReturn of Premium Rider
- DAccelerated Death Benefit Rider
Show answer & explanationAnswer & explanation
Correct answer: A. Waiver of Premium Rider
The Waiver of Premium Rider is specifically designed to keep a life insurance policy in force if the insured becomes totally and permanently disabled. Upon meeting the definition of disability and completing a waiting period, the insurer waives future premium payments for the duration of the disability.
Why the other options are wrong
- B. This rider allows buying additional coverage without proof of insurability, unrelated to disability and premiums.
- C. This rider returns the premiums paid if the insured outlives the policy term, unrelated to disability.
- D. This rider allows access to a portion of the death benefit early for terminal illness, unrelated to premium payments due to disability.
Waiver of Premium Rider
A life insurance rider that waives the payment of premiums if the insured becomes totally and permanently disabled, keeping the policy in force.
- Requires total and permanent disability.
- Includes a waiting period (e.g., 6 months).
- Premiums are waived, not refunded.
Memory trick: Riders add protection, Waiver stops premium collection.