Waiver of Premium Rider: Definition, Benefits, Cost and Recommendations

A waiver of premium (WOP) rider is an optional add-on to your life insurance policy that suspends premium payments if you become disabled. While your base policy provides death benefits to beneficiaries, the WOP rider adds living benefits by protecting the policy itself during periods of disability.

Without this rider, missing premium payments would cause your policy to lapse, leaving your beneficiaries without coverage. The WOP rider acts as a safety net, covering payments until you recover or reach the rider's age limit. You can use it multiple times if your condition recurs.

Life insurance companies don't publish detailed lists of qualifying medical conditions because they want to review each case individually. The same condition might be eligible for one person but not another, depending on their job and the severity of their symptoms. Instead, insurers keep definitions general to consider the full picture when making decisions.

Having one of the conditions below doesn't automatically mean you'll qualify for waiver of premium benefits. Insurers examine whether your specific condition prevents you from working, not just the diagnosis itself.

Medical disabilities:

• Lost limbs or mobility
• Blindness or major vision loss
• Hearing loss or deafness
• Chronic illnesses that stop you from working
• Mental health conditions that prevent you from working
• Cancer needing extensive treatment
• Heart conditions
• Neurological disorders like stroke, Parkinson's disease or epilepsy
• Diabetes with serious complications
• Autoimmune disorders that make consistent work impossible
• Traumatic brain injury affecting your thinking
• Multiple sclerosis with worsening symptoms

Occupational disabilities:

• Can't perform your specific job duties anymore
• Can't work in any occupation (stricter definition)
• Lost your professional license because of disability

*This is educational information only, not medical or legal advice. Talk to your insurance provider and healthcare professionals about your specific situation.

You can add a waiver of premium clause to your policy when you buy your life insurance. Waiver of premium riders range from $3 to $50 per month or 3% to 20% of your base premium, based on our research. A 27-year-old woman with a $500,000 term policy paying $21 monthly might pay an additional $3 monthly for the rider. On term life policies, the rider usually costs 10% to 20% of the total annual premium, while whole life policies have costs of 3% to 5%.

Factors that can affect the cost of this rider include: 

• Age: Younger applicants pay less because they're less likely to become disabled during the term of coverage. Costs increase after age 40.
• Health: Pre-existing conditions or health issues raise premiums. Some conditions may disqualify you entirely from this rider.
• Occupation and hobbies: High-risk occupations like firefighters, police officers and pilots typically fall into a category that makes it more challenging to qualify for a waiver of premium. Dangerous hobbies also increase the cost.
• Policy type: Term life riders have a cost that is a higher percentage of the monthly payments, but whole life riders cost more in actual dollars due to higher base premium payments.

A waiver of premium rider isn't right for everyone. Your decision depends on your financial situation, health, age and existing coverage. Here's how to determine if this rider makes sense for your circumstances.

Buy this rider if:

• You're the only income earner: Losing your paycheck means you can't afford life insurance premiums anymore.
• You work a high risk job: Construction workers, police officers, firefighters and pilots get disabled more often than desk workers.
• Disability runs in your family: Genetic risks for multiple sclerosis or heart disease make you more likely to need this coverage.
• Your emergency fund is small: You can't afford premium payments during a long disability without savings.
• You're young: The rider costs less when you're younger and protects you for decades.

Skip this rider if:

• You have substantial savings: A year or more of expenses saved means you can cover premiums during short term disability.
• Your disability insurance is excellent: Strong coverage through work or a private policy makes this rider redundant.
• You have pre-existing conditions: Health problems either disqualify you or make premiums extremely expensive.
• You're close to retirement: Limited benefits when you're near age 60 to 65.
• Your term policy ends soon: Don't pay for expensive riders on policies you'll drop in a few years.

Complete documentation and following your insurer's requirements gets your claim approved faster, letting you focus on recovery instead of premium payments.

We answer common questions about waiver of premium clauses and riders.