Waiver

What Does Waiver Mean?

A waiver refers to the intentional and voluntary relinquishment or abandonment of a right, privilege, claim, or legal benefit, often expressed in writing. In the context of insurance, a waiver can apply in various ways, such as provisions that waive coinsurance in property insurance or premiums in life insurance.

Insuranceopedia Explains Waiver

In essence, a waiver serves to remove real or potential liability for one party in an agreement. In insurance contracts, waivers often come with specific conditions or stipulations that must be met for the waiver to take effect. For example, a life insurance policy with a waiver of premium protects the insured from losing coverage if they are unable to pay due to serious illness or disability. However, for the premium to be waived, both the policyholder and the situation must meet certain conditions, such as the disability lasting six months or more and the policyholder being of a certain age and health at the time of the agreement.

This is one reason some buyers pair a life policy with separate disability insurance, since the two products handle income loss and policy upkeep differently. Whether a waiver of premium rider is included by default or sold as an add-on also varies between top-rated life insurance companies, so it’s worth comparing policy documents directly. The cost of adding the rider depends on the same factors that affect what you pay for your base life insurance premium, including age and health at the time you apply.