The right to include the waiver of premium
rider in the converted policy can be an important feature, particularly if the conversion to a policy with a waiver of premium
rider can be made even if the insured is already disabled.
My policy states that I have waiver of premium
. What is this and when will it start?
Waiver of premium
. This feature pays the premium of a policy if a serious illness or injury causes the policyholder to become disabled.
face amount Issue age range 25-55 (35-55 in WA) Built-in riders * Waiver of premium
payments for one year in the case of unemployment * In case of disability, payments waived until disability ends or the policyholder turns 65 Premium payment At the end of the level period (age 65), period premiums increase annually for 20 yrs.; annually increasing premiums are guaranteed.
After all, when was the last time your company sold a group life plan without waiver of premium
? Not only that, but the IRS already has issued a number of private letter rulings allowing employers to offer a disability income feature inside a 401(k) plan.
With waiver of premium
, it is self- completing if totally disabled.
If disability occurs, look at the life policy for waiver of premium
, the disability policy for the benefit elimination period, the definition of disability, and the benefit period.
Our advice is to join your employer's pension scheme if one is available and, if not, select a current modern flexible contract with a competitive charging structure and waiver of premium
benefit, then review your pension when the new arrangements are finalised as the government intends that it should be possible to convert to a stakeholder scheme if it is in your best interest to do so.
More may be added if they can meet Torquil Clark's tough criteria, including investment performance, financial strength, charging structure and waiver of premium
The disadvantage with purely lump sum payments is that you generally can't include Waiver of Premium
which protects your future pension against long term illness or injury.
For example, a client with both a traditional LTCI policy and a life policy with care benefits would want to use the traditional LTCI coverage first to activate that policy's waiver of premium
feature while preserving the life policy's death benefit.