Jargon Buster - Definition of Waiver of Premium

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Waiver of Premium

is an addition to an insurance policy which means that the insurance company will pay your premiums if you are unable to work due to accident or sickness for a period of time. Waiver of Premium is usually added to Income Protection Policies as a default option, this means that if you claim on the policy, you don't continue to pay your premiums.

Waiver of Premium can also be added to life insurance and critical illness policies and are usually available for a nominal price. Obviously Waiver of Premium is only available if you are employed and it is usually only until the age of 65.

You can often choose a deferment period, i.e. how long you have to be off work before you can claim Waiver of Premium. The common period is 26 weeks, however you can often choose from 4, 13, 26 and 52 week deferment periods.

Please note that all definitions are intended for general guidance only. For official and current definitions you should always double check your policy wording.

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