What does "waiver of premium" mean in the context of life insurance?

In life insurance, the term "waiver of premium" refers to a provision that allows the policyholder to avoid paying premiums if they become disabled. This feature is especially important for individuals who may be unable to work and earn income due to a serious illness or injury.

When the waiver of premium provision is activated, the insurance company will continue the coverage without requiring premium payments for as long as the insured remains disabled, typically for a specified period or until they recover. This ensures that the policy remains in force and that the insured's beneficiaries will receive the death benefit if the insured passes away during the period of disability.

This provision provides significant financial relief and peace of mind to policyholders, knowing that they will not lose their life insurance coverage due to an inability to pay premiums while they are incapacitated. The other choices do not accurately capture the meaning of "waiver of premium," as they either refer to discounts, penalties, or temporary suspensions that do not align with the protections offered by this specific provision.