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When taking out life insurance, you may have the option of adding a waiver of premium benefit in case you are unable to work due to illness or injury. But how does this help you and what does it mean for your policy?

A waiver of premium benefit provides a way to protect your life insurance monthly premiums and look after your life assurance policies. It means that if you are incapacitated and unable to work for more than six months due to illness or injury, the life insurance provider will continue to pay premiums until you have recovered, if necessary until the end of the plan term.

Waiver of premium can usually be included as an optional addition to your life insurance policy. The insurance provider will typically charge you for this benefit and it will be subject to the provider’s policy terms and conditions. There may also be some restrictions such as age, health or occupation that vary between insurance providers.

For your insurance policy to remain in force, you must always pay your premiums. If you stop making these payments, your cover will end and the policy will have no value. It is therefore very important that you keep up premiums so that you and your family are continuously protected financially against your illness or death.

Illness or injury and the subsequent inability to work can have an enormous impact on you and your family. Imagine you are unable to go to work. For reasons beyond your control, you may find it difficult to earn a regular income and your financial situation may become quite strained: this is why the benefit of waiver of premium is often recommended. It can be particularly valuable if the premium on your policy is quite high, making keeping up the payments even more difficult.

If you do become incapacitated – and you have the waiver benefit – make sure you let your insurance provider know as soon as possible. The definition of incapacitated can vary according to your employment status at the time (if you are unemployed, self-employed, or employed); so be sure to check this with your individual provider. Once you have informed your provider about being incapacitated, you will receive a form which you must complete and return, you will also usually be required to provide evidence of your health and inability to work. If your claim is valid, your insurance provider will waive payments until you cease to be incapacitated, or your policy or right to the benefit ends.

The waiver of premium benefit could be a wise investment: by choosing to pay a little extra on your premiums, you could be saving yourself from a great deal of stress and financial difficulty later on. And in terms of life insurance, it means that you can feel confident that your family will still be financially protected.

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