Life insurance plans are policies that can be bought in order to cover your medical and health-related insurance needs. However, if you have observed then life insurance plans can be coupled with riders to provide you with the most benefit of the premiums that you are paying. So one of the riders that you can add-on to your life insurance plan is a waiver. Let us understand what a waiver is.
A waiver of policy premium is a rider that waives off the future premium for the policyholder in certain scenarios like if the holder suffers from a critical illness, disability due to an accident or any other serious injury that makes them unable to render any earning. You can add a waiver of policy premium rider on your life insurance plan by paying an additional premium to the insurer.
The waiver of premium rider usually kicks in and becomes active in the following scenarios:
- If you are disabled for a period of atleast 6 months
- If you are diagnosed with any critical illness such as heart attack, cardiovascular disease or cancer and other such ailments
There is a waiting period of 90 days once you add the rider of waiver of policy premium to your policy. Post 90 days have elapsed, your rider will be active. However, you will not be able to use the waiver in the following scenarios:
- If the ailment or the disability occurs during the waiting period
- If you are contracted with HIV
- Participation in any criminal activity or illegal activity
- Participation in any adventure sports or dangerous activities like bungee jumping, hiking, diving, martial art, etc.
- Participation in wars, riots, strikes, invasions, etc.
- Any congenital infection
Any individual between the ages of 18 to 65 is eligible for the waiver of the policy premium rider. Either this rider can be added to your life insurance plan at inception or even later, however, it cannot be removed from your policy once it has been added, depending on the policy of the insurance service provider.
There are certain tax benefits that can be availed when an individual is insured by a Life insurance plan. The tax benefits are under the Income Tax Act, 1961 under section 80(c) wherein you can get a deduction of about 1.5 lakh rupees.
Who can take advantage of this rider?
This waiver of policy premium rider is beneficial to those life insurance plan holders who are the sole breadwinner for their families and have multiple people dependent on them for their basic and daily necessities. You may be paying your life insurance plan’s premiums in a diligent manner; however, if something were to happen to you then in that case, a rider like waiver of policy premium would lift the burden off your shoulders with regards to the payment of the premiums and would save you from having your policy being lapsed.
Be sure to conduct thorough research and analyse your needs before investing or adding any rider to your policy.
