Life Insurance

Know All About Waiver Of Premium Rider

Nov 15, 2021

As cautious and loving individuals you keep yourself secured by purchasing a life insurance policy in order to guard the lives of your loved ones in case you are not physically present in this world. You research, buy the best plan that suits you accordingly and then pay the premiums on time or even before the premium payment deadline. 

Have you ever wondered that it may so happen that you for some reason will not be able to pay the premium and that would just make your insurance null and void or else you may just suddenly and unexpectedly pass causing an end to your insurance policy? It would not help much in keeping your family stable for a long period of time.

So is there a way where we could rest assured that our insurance policy still keeps us covered long after we are gone or not able to pay premiums in the case we have acquired a lifelong ailment?

This is where Waiver Of Premium Rider or (WOP) comes into the picture. With the waiver, we will be secured even if you, unfortunately, die unexpectedly or are even unable to pay your premiums due to serious and life-endangering ailments.

Knowing what a Waiver Of Premium Rider (WOP) is all about:

A Waiver Of Premium rider ensures that your insurance policy doesn’t get cancelled or even become inoperative because of certain instances that could occur in life that could hold back the policy owner from paying premiums. 

One of the most crucial prerequisites of holding an insurance policy is to pay the premium on time or in advance. If we fail to do so then our insurance may even get terminated which is the last thing you would want if you wish to keep the ones you love free from harm.

A Waiver Of Premium can be a component of the already existing insurance policy as a combined component voluntarily adjoined as a waiver of premium while you obtain a policy. It is for sure advantageous to merge a rider like such for the benefit of the ones you care most about.

How is a waiver advantageous after the inability of the policyholder to pay a premium?

A person at any point of time can become incapacitated and that would lead to non-payment of premium which would ultimately lead to termination of the insurance policy. You may have taken the insurance policy in order to safeguard the future of your offspring and a rider would help you do just that even after you are not present in the physical form to do so for your kid.

Just as the name suggests, a waiver will waive off your debt in the instance of total or partial disability of the policyholder and the premium would be paid off by the insurer depending it meets certain terms and conditions. 

The common insurance policy that we hold would not prove to be useful to your child’s benefit in the long run if he or she would want to pursue higher studies that could be far ahead in the future. The waiver would help you to keep your insurance effective in the long run that would shield your child’s future.

In case of a regular insurance policy, the added rider would help you to keep your insurance continued even if you are incapable of paying a premium due to a long-lasting ailment or even death.

This too comes with a set of exclusions and we need to keep in mind that the waiver will not always be beneficial if you check out any of the exceptions listed as follows.

Let me explain with an example:

Suppose you have taken a Child Money Back Insurance Plan with WOP rider for the educational expenses of your child wherein the payouts would be when your child is 18 years, 20 years, 22 years and 25 years respectively. Now, if you happen to die much before the child attains 18 years plan, then your dream of funding for the child’s education would be jeopardized.

However, since this Child Money Back Insurance Plan has a Waiver of premium rider attached to it, the future premiums would be waived off and the plan would continue as it is. The insurance plan would pay the entire survival benefit when the child is 18 years, 20 years, 22 years and 25 years respectively as planned without any hassles.  This is where the WOP rider comes most handy.

Exclusions in the Waiver Of Premium (WOP) Rider

The waiver does not prove to accomplish if your ailments that are long-lasting are not caused by the following:

  • Any long term injuries caused due to wars, an incursion or any protest induced condition
  • Any inveterate condition that has been inherited through the family
  • Self-induced conditions that include suicide, partaking in activities that are life-threatening like fights or sky diving
  • If you are an HIV or AIDS patient

Documents that are would be necessary for a Rider

There needs to be a set of imperative and alternative documents that you would need to produce in order to accomplish your claim request fruitfully.

Imperative documents include

  • Authentic policy certificates
  • An appropriately completed claim application
  • Insured individual’s present residency proof and credentials

Alternate Documents include

  • Bank passbook copy of the insured individual
  • Medical records specifying particular ailment
  • Impairment documentation from a reliable Government organisation

Conclusion

It is wise to adjoin a rider to our already existing policy because we cannot ensure that a mishap would only lead to death and our family will be fulfilled after that. It is important to understand that the amount received via insurance is a mere catalyst and cannot fulfil the void in lives of our loved ones and a waiver could be really beneficial for us to rest assured that the family hat we leave behind is not in dire states if we are gone or if we are incapable of being a provider to the family.

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