Question 28

Waiver of premium waives premiums if the insured becomes disabled.

The waiver of premium rider ensures that if the insured becomes disabled, they will not have to pay premiums for their insurance policy during the period of disability.

A) Waiver of premium

This option is correct because the waiver of premium specifically provides for the suspension of premium payments in the event of the insured's disability. This rider is designed to protect the policyholder from losing coverage due to an inability to pay premiums caused by a qualifying disability.

B) Waiver of cost of insurance

This option is incorrect because the waiver of cost of insurance does not pertain to premium payments but rather to the costs associated with maintaining a policy, typically in relation to universal life insurance. It does not provide a benefit specifically for the insured's disability.

C) Disability income rider

This option is also incorrect as a disability income rider provides a stream of income to the insured if they become disabled, rather than waiving premium payments. While it offers financial support, it does not directly address the payment of premiums.

D) Accelerated death benefit

This option is incorrect because the accelerated death benefit allows the insured to access a portion of their death benefit while still alive, usually in the event of a terminal illness. It does not provide for waiving premium payments if the insured becomes disabled.

Conclusion

The waiver of premium is the only option that directly addresses the issue of waiving premium payments during a period of disability, making it the definitive correct choice. Other options focus on different aspects of insurance benefits and do not fulfill the requirement of waiving premiums in the event of a disability.