Understanding the Disability Waiver of Premium

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The Disability Waiver of Premium rider
takes financial stress away,
so you can still play sports
like you use to.

Disability Waiver of Premium is a rider available on most life insurance policies.However, most insurance companies have a maximum issue age on the rider of 60, so applicants over that age will not be able to add this rider.


The Disability Waiver of Premium is intended to waive the insured's premiums should he or she become disabled. Essentially, the insurance company will forgo future premiums while the insured retains the policy benefits. Remember though, there is usually a waiting period of 90 days.

The disability waiver feature differs from company to company, but often expires at age 65. The one major caveat is that most insurance companies change the definition of disability to "Any Occupation" after two years. Under this definition, total disability means not being able to work in any occupation. Therefore, if the insured is a computer consultant and their disability prevents them from working at their primary occupation, but they can still work as a checkout clerk at a grocery store, they won't receive a cent. Still confused? You can find a more comprehensive explanation of disability definitions here.

The Disability Waiver of Premium is intended to waive the insured's premiums should he or she become disabled. Essentially, the insurance company will forgo future premiums while the insured retains the policy benefits.

Given the limitations of the Disability Waiver of Premium rider, the applicant is far better off looking at his or her disability insurance through a more holistic lens i.e. the insured should have an adequate amount of disability insurance to protect the needed percentage of his or her total income. It's usually recommended that the insured cover anywhere from 50%-66% of their total income. That income, which is tax free (assuming the premiums are paid with after-tax dollars) can then be used to pay for food, household and other related expenses, including the insured's insurance policy.

The one exception to this rule is applicants with high-risk occupations. On traditional disability policies, landscapers have a higher-risk occupation than physicians and pay a much higher premium. But, with the Disability Waiver of Premium, the risk charge is the same for both occupations. In this instance, it makes sense if traditional disability insurance is unaffordable because something is better than nothing.

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You can get a free disability insurance quote at our Disability Instant Quote Page, or contact us at 1.866.899.4849 for more information. 


  1. Peg 07/10/2013 at 1:39 pm

    Hi…I have been reading everything I can about a Disability Waiver of Premium, but I still cannot get an answer to this…I have a policy that ends in 20124. IF my policy says “Waiver expires in 2014″ (when I am 60), does that mean that, after 2014, the waiver cannot ever be elected should I become disabled…OR…does it mean that IF I am already using the waiver of premium due to a disability, it completely ENDS in 2014 and I would then have to pay the premiums until 2024 (age 70), when my policy ends?. Seems unfair if it’s the latter.

  1. LSM Insurance 07/10/2013 at 2:49 pm

    Thanks for the note Peg. It depend on the policy wording. It would write the insurance company and ask for a response in writing. I hope things work out.

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