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Reasons To Choose Waiver Of Premium Rider

Published On Mar 11, 2022, Updated On Mar 12, 2022

Riders are extra terms that are charged individually and applied to an individual's current insurance policy. A rider is a type of insurance policy that adds extra coverage and risk protection to an existing policy. Insurance riders are inexpensive add-ons to an individual's existing life insurance policy. They are intended to supplement and broaden a person's insurance coverage to provide more than just death benefits. The premium rider is waived in the event of unanticipated circumstances such as disability, or significant illness as a consequence of an accident or other cause. The individual is excused from paying any future insurance premiums because of this rider. 

Reasons to Choose Premium Rider Waiver

Some of the reasons for an individual to Opt for Waiver of Premium Rider are as follows:

  1. Prevention of policy lapse

The main advantage of including a waiver of premium benefit rider in a life insurance policy for an insured person is that it keeps the policy from expiring owing to nonpayment of premiums. It is crucial to understand that a person can not file a claim on a life insurance policy that has already expired. As a result, this add-on function ensures that their insurance remains valid even if they do not pay the stipulated premium installments.

  1. Policy Continuation After Death

The majority of life insurance policies will lapse if the insured person dies during the policy's term. In this case, the predetermined death benefit is paid to the nominee of the relevant covered individual. Even if one of the following scenarios occurs, an insured person adds the waiver of premium rider to their life insurance policy, it will continue to pay out until the policy's term ends.

  • The insured person's death occurs, and the death benefit is paid to their nominee.

  • An incident that prohibits an insured person from paying their premiums on time due to a total or permanent incapacity.

As a result, it is always a good idea to include a premium waiver rider in a life insurance policy for an insured person.

  1. Protection of an Individual's Financial Goals

A physical problem can throw a person's life into full disarray, causing them to fall behind on their bills and abandon their financial aspirations. A family may be forced to deal with great financial difficulty, as well as major medical expenditures and emotional suffering, as a result of the aforementioned disease. A waiver of premium benefit allows an insured person to keep their insurance even if they are unable to make any additional payments. As a result, an insured individual's financial objectives for which coverage was acquired remain unaltered. If they pick a waiver of premium insurance after investing in the policy to build up large cash for their child's educational experience, wedding expenses, or arranging for their post-retirement plan, they can still fulfill their financial goals even if they suffer a lifelong disability.

  1. Financial Security of an Individual’s Family

The financial security of an individual's family may be jeopardized if their life insurance policy fails due to nonpayment of payments. The waiver of premium life insurance rider allows an individual to protect their family's financial future even if they are unable to pay more premium payments to their life insurance policy in this situation. A critical illness waiver of premium riders can also protect a person from being unable to pay their premiums after being diagnosed with a severe illness.

Take Away

Because of the multiple benefits that a waiver of premium rider provides, including one in an individual's life insurance policy is always a wise decision. In addition to providing life insurance, this provision makes an insured individual's policy more comprehensive and helps them protect their family's income in the event of a prolonged disability or catastrophic illness.

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.

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