Waiver Of Premium Rider

DEFINITION of 'Waiver Of Premium Rider'

A clause in an insurance policy that waives the policyholder's obligation to pay any further premiums should he or she become seriously ill or disabled. A waiver of premium allows people to benefit from an insurance policy, even when they cannot work.

BREAKING DOWN 'Waiver Of Premium Rider'

For an upfront charge, most insurance companies will incorporate a waiver of premium into a policy. The waiver is usually associated with life insurance policies, and requires the policyholder to be disabled for a specified amount of time, such as being incapacitated for six months. To have a waiver of premium, some companies may also place other requirements on the policyholder, such as being healthy and below a certain age.

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