Consider a financially responsible individual who has taken steps to secure their family's financial future by investing in a life insurance policy that provides coverage in case of an unexpected event. However, unforeseen medical issues can arise, leaving them unable to work and support his/her loved ones. At this point, paying insurance premiums becomes a financial burden they cannot afford.

Thankfully, a solution is available in the form of a "Waiver of Premium Rider" that can be added to the term insurance policy. This rider acts as a safety net, ensuring that insurance coverage continues even if the policyholder cannot pay his/her bills due to illness or injury. By adding this rider, the policyholder can expand the protection provided by his/her term insurance policy and enjoy invaluable peace of mind.

When purchasing term life insurance, it's essential to consider all factors, not just the death benefit. The Waiver of Premium Rider is a clause that can significantly enhance the value of a policy. This article will explore the specifics of the rider, including who qualifies, how it works, and its benefits. Whether someone is a first-time insurance buyer or an experienced policyholder, this article is a must-read for those who want to fully comprehend the power of a Waiver of Premium Rider.

So let's dig right into the subject of term insurance premium waivers.

What is a waiver of premium rider?

A waiver of premium is nothing but a facility that guarantees continued term insurance coverage in case you are in a financial crunch owing to a  compromised source of income due to an accident, a disability, or a severe illness.

In summary,

  • This rider primarily intends to pay the expenses of term insurance in the event of a severe illness or permanent disability.
  • In the event of a physical disability, this unique rider exempts the life guaranteed from having to pay any further premiums in the future.

The term insurance policies are typically canceled, and your coverage expires if you don't pay your premiums. However, suppose you have a waiver of premium benefit in place and satisfy the requirements. In that case, with the Waiver of Premium Rider, your coverage will continue even if you cannot pay your premiums because of a medical condition that prevents you from working for an extended period.

How does Waiver Of Premium rider in Term insurance work?

This rider can be a lifesaver for policyholders who find themselves unable to pay premiums due to an unexpected disability. But how does it work, exactly? Let's take a closer look.

Lets understand this by way of a simple example,

Meet Mrs. B, a savvy individual who takes her family's financial future seriously. To safeguard their well-being, she invests in a term life insurance policy with a whopping Rs. 1 crore coverage for a period of 20 years. In the unfortunate event of her untimely demise, her beneficiaries will receive the sum insured, which will provide them with ample financial support to cover critical expenses such as education, mortgages, and daily living. Now here, this policy, with its no-frills approach, does not offer any cash value or bonuses, ensuring that all of the premiums paid go directly towards coverage.

Now!!! If Mrs. B decides to add the Waiver of Premium Rider, it will keep the policy in force even if she is unable to pay premiums due to a disability. With Mrs. B's well-informed decisions, her family can rest easy knowing that they are taken care of, come what may. The insurer pays the agreed-upon amount, continues to pay plan premiums, and releases the money on the due date.

A waiver of premiums cannot be activated the moment you stop working. Most policies contain a waiting period that stipulates that you must be disabled for at least three months and often even longer before you can claim the benefit.

Additionally, there can be limitations on your ability to request a waiver of premium within the first few months after you've purchased the policy. Your inability to work must meet the policy's definition of incapacity to activate the benefit correctly. Also required is evidence that you cannot work, such as a home inspection or medical report.

Benefits of Waiver Of Premium Rider in Term Insurance

Keeps your term life insurance policy active:

The main advantage of including a waiver of premium benefit rider is that it stops the policy from expiring due to missed premium payments. It is significant to remember that a lapsed policy cannot be used to submit a life insurance claim. Therefore, this add-on function retains your insurance even though the preset premium instalments have yet to be paid.

Keeps your family financially safe and secure:

You may rest easy knowing that your life insurance policy will still be in effect even if you cannot pay the premiums because of an illness or accident. You may be sure that in the event of your untimely passing, your family will be financially taken care of.

Helps in preserving your saving

This rider is like a superhero that can rescue your precious savings in times of need.  When a serious illness or disability strikes, it can drain your hard-earned savings and leave you struggling to maintain the lifestyle you’re used to. But fear not, because the waiver of premium rider is here to save  the day! By covering your insurance premiums during a time of disability, it helps preserve your savings and assets, leaving them free to be used for other important goals like your child education or your retirement. So sit back and relax and let waiver of premium rider be your financial savior.

What are the exclusions under the Waiver of Premium in Life Insurance Plans?

Some of the exclusions under Waiver of Premium rider are -

  1. Suicide of self-inflected injuries
  3. Congenital Infection
  4. War, civil commotion, breach of law, or wilful participation in violent acts
  5. Alcohol or substance abuse
  6. Injury due to adventurous sports or hazardous activities.
  7. Pre-existing medical condition
  8. Radioactive contamination due to nuclear accident

Eligibility Criteria for Waiver of Premium Rider

Criteria Eligibility
Sum Assured Minimum - Same as base policy’s sum assured
Maximum - No Limit (depending on the life insurance policy)
Minimum Entry Age 18 Years
Maximum Entry Age 65 Years
Coverage Period Same as base term insurance plan
Maximum Maturity Age 70 Years
Waiting Period 90 Days
Premium Payment Mode Same as premium payment mode of the base policy
Premium Payment Term Same as base term insurance plan

Waiver of Premium Claim Requirements

Documents Required for Waiver of Premium Rider Claims

The following documents must be presented with the application in the appropriate format and within the first 30 days of receiving a diagnosis of any severe disease or disability to successfully request a waiver of the premium rider.

  • Original Policy Document
  • Filled Claim Form
  • Policyholder’s Photo ID Proof
  • Policyholder’s Address Proof
  • Medical Reports (for Critical Illness)
  • Copy of policyholder’s bank statement/cancelled cheque
  • Disability Certificate from local government body
  1. While the requirements for submitting a claim can differ, they usually involve a doctor's note and an SSA notification attesting to the physical impairment or disability. The applicant could then submit a claim form.
  2. Your insurance provider will begin waiving your premium payments after accepting your claim. You won't need to pay any premiums for the waiver time, and your insurance coverage will remain in effect.


To sum up, the waiver of premium riders is a valuable addition to a term insurance policy. It gives you peace of mind knowing that your insurance premiums will be waived in the case of an unforeseen illness or injury, allowing you to concentrate on getting better without worrying about financial pressure.

This rider can act as a safety net for you and your loved ones, guaranteeing that your insurance coverage continues even under financially trying circumstances. Policyholders must consider this rider when acquiring your term insurance policy, as it can offer you and your loved ones priceless protection.

Frequently Asked Questions

Is there a time frame for how a term insurance policy's Waiver of Premium rider will cover premium payments?

Yes, there is a 90-day waiting time. It indicates that the insurer will only waive future premiums if the insured develops a severe illness or becomes disabled after the policy's initial 90 days have passed.

How long must I be disabled before the term insurance policy's Waiver of Premium rider kicks in?

Usually, a waiver of the premium clause only becomes effective if your disability will last at least six months. Both long-term and short-term disability insurance is offered, with the former commencing at about three months.

After obtaining my term insurance policy, Can I add a waiver of premium rider?

No, you cannot add a waiver of premium after getting term insurance coverage. It must be acquired when the term insurance policy is bought or as an add-on rider later in the term. Including the waiver of premium benefit to your term insurance plan when you first acquire the policy is preferable to ensure you have the coverage in place when you need it.

Does waiver of premium rider cover all types of illnesses or disabilities?

As the policy specifies, the premium waiver usually only applies to certain diseases or impairments. These conditions, including serious injuries or chronic illnesses, would frequently preclude the policyholder from working and earning a living. To comprehend what it covers, it is crucial to carefully read the premium rider's terms and conditions waiver.