waiver rider

[1695814]

When a policyholder has a "waiver of monthly deduction rider" what, generally, happens?

Are just the COIs waived?

Or are the premium & policy expenses usually also waived? (The guy still paid premiums even though he was disabled.)

Thank you,
:duh:

[Chris Poirier]

The name is a pretty good description. The full monthly deduction is waived, including policy fees, cost of insurance charges, and charges for any additional riders or benefits. The policyholder may or may not choose to continue paying premium.

Some companies also (or instead) sell a "waiver of specified premium" rider. In this case, a fixed premium amount is waived and the amount waived is treated as premium paid into the policy (premium expense charges could continue to be deducted from this "premium"). The company might define premium so that it cannot be more than was paid into the policy in the past 12 months - preventing someone from paying $100 a month but wanting to waive $200 a month (a big red flag for disability coverages).