What is “waiver of premium” or “premium protection”?
This is an additional feature available on most life insurance and critical illness policies. It is designed to provide for payment of the premium if the policyholder is ill and loses his/her income. The feature normally provides that if the policyholder is ill for 6 months or more and is unable to carry on his/her normal occupation then the insurance company will pay or “waive” the premiums from the 7th month onwards. The benefit ceases when the policyholder recovers and returns to work. Some insurance companies offer deferred periods shorter and longer than 6 months. The benefit can be set up on an “own occupation” basis or “any occupation”. The benefit must be selected at the time of application. A small additional cost is involved which will depend on the type of benefit selected, occupation and state of health.
