Life & Health · Lesson directory

RIDERS · T140–T142

Premium Waiver & Payor Riders

Distinguish premium waivers, monthly-deduction waivers, and juvenile-policy payor benefits.

3 cards · Three practice questions for each card

CARD T140

Waiver of Premium Rider

A rider excusing specified premiums after a qualifying disability and required waiting period. The policy defines disability and eligibility.

How it works

A waiver-of-premium rider waives specified premiums when the insured meets the rider’s disability definition and other conditions. A six-month disability waiting period is common in exam examples, but actual periods, age limits, and definitions vary. Premiums may need to be paid while the claim is evaluated; any retroactive refund follows the rider. Coverage continues according to the rider rather than because premiums can simply be ignored. [11] [19]

EXAMPLE

A rider requires six months of qualifying total disability. Once its conditions are met, covered premiums are waived. Whether earlier payments are refunded depends on its terms.

Key distinction

This protects the life policy’s funding. It does not ordinarily replace the insured’s lost wages.

Practice Waiver of Premium Rider · 3 questions

CARD T141

Waiver of Monthly Deductions Rider

A rider waiving specified policy charges after qualifying disability. It may cover deductions rather than the owner’s entire planned premium.

How it works

A waiver-of-monthly-deductions rider usually waives specified monthly charges on a flexible-premium policy after qualifying disability. It need not waive or supply the entire planned premium. Thus it can protect coverage without adding the cash accumulation that a full planned deposit would have funded. Covered charges, waiting periods, age limits, and claim requirements are contract-specific. [13]

EXAMPLE

A planned monthly deposit is $300 and the rider waives $80 of covered monthly deductions. It does not necessarily deposit the other $220 into account value.

Key distinction

Waiving monthly deductions is not the same as funding the full planned premium.

Practice Waiver of Monthly Deductions Rider · 3 questions

CARD T142

Payor Benefit Rider

A rider waiving specified premiums on a juvenile policy if its payor dies or becomes disabled under the rider’s terms.

How it works

A payor benefit commonly appears on a juvenile life policy. If the adult paying premiums dies or becomes disabled as defined by the rider, premiums may be waived until the child reaches a specified age or other stated endpoint. The child remains the insured under the juvenile policy. The covered payor event and duration must be checked rather than assumed. [19]

EXAMPLE

A parent pays premiums on a child’s life policy. Under a rider covering the parent’s qualifying disability, future premiums are waived until the stated age limit while the child’s coverage continues.

Key distinction

The payor’s death can trigger a premium waiver without triggering the child’s death benefit.

Practice Payor Benefit Rider · 3 questions

APPLY THE TERMS

Practice questions

Select an answer, then check it to see why each option is right or wrong.

T140 · Waiver of Premium Rider

0 of 3 answered

QUESTION 1 OF 3What does a waiver-of-premium rider primarily provide?
QUESTION 2 OF 3A rider expressly requires six months of qualifying disability. Does one month alone satisfy that waiting period?
QUESTION 3 OF 3What should be distinguished from waiver of premium?

T141 · Waiver of Monthly Deductions Rider

0 of 3 answered

QUESTION 1 OF 3A rider waives $80 in covered deductions on a policy with a $300 planned monthly deposit. What does that promise alone provide?
QUESTION 2 OF 3Why might cash accumulation differ during a deductions waiver?
QUESTION 3 OF 3Which wording is most important in evaluating this rider?

T142 · Payor Benefit Rider

0 of 3 answered

QUESTION 1 OF 3Who is commonly the insured under a juvenile policy with a payor-benefit rider?
QUESTION 2 OF 3What can a qualifying payor event trigger?
QUESTION 3 OF 3How long does a payor waiver continue?

Sources & further reading

Original explanations and practice scenarios informed by the following regulatory, legal, and product resources. State examples are not presented as nationwide deadlines or requirements.