How does a policyholder benefit from a premium waiver rider during disability?

How does a policyholder benefit from a premium waiver rider during disability?

• A. They can receive increased death benefits
• B. Their policy remains active without premium payments
• C. They get a reduced premium rate
• D. They can convert their term policy to whole life

Answer: (B)

A premium waiver rider is a valuable feature in a life insurance policy that helps protect the policyholder during times of hardship, particularly when facing a disability. When a policyholder becomes disabled and is unable to work, the premium waiver rider ensures that their life insurance policy remains in force without the obligation to pay premiums during the period of their disability. This means that the policyholder does not have to worry about losing their life insurance coverage due to non-payment of premiums, which can be particularly important if they are already facing financial strain due to their inability to earn an income. The rider essentially waives the requirement to make premium payments while the insured is disabled, allowing them to maintain their benefits without additional financial burden. The other options do not accurately reflect the function of a premium waiver rider. For instance, increased death benefits, reduced premium rates, and the conversion of term policies to whole life insurance are not inherent attributes of a waiver rider and typically relate to different features or riders within a life insurance policy.

A premium waiver rider is a valuable feature in a life insurance policy that helps protect the policyholder during times of hardship, particularly when facing a disability. When a policyholder becomes disabled and is unable to work, the premium waiver rider ensures that their life insurance policy remains in force without the obligation to pay premiums during the period of their disability.

This means that the policyholder does not have to worry about losing their life insurance coverage due to non-payment of premiums, which can be particularly important if they are already facing financial strain due to their inability to earn an income. The rider essentially waives the requirement to make premium payments while the insured is disabled, allowing them to maintain their benefits without additional financial burden.

The other options do not accurately reflect the function of a premium waiver rider. For instance, increased death benefits, reduced premium rates, and the conversion of term policies to whole life insurance are not inherent attributes of a waiver rider and typically relate to different features or riders within a life insurance policy.