Definition Of Waiver Of Premium (wp) In Insurance

Definition of "Waiver of premium (wp)"

Charlie Butler, Associate Broker, Real Estate Agent Century 21 Steele & Associates

In life insurance, action by an insurance company canceling premium payments by an insured who has been disabled for at least six months. The policy remains in force and continues to build cash values and pay dividends (if it is a participating policy), just as if the insured was still making premium payments. Experts suggest that this clause should be considered in a life insurance policy since the probability of becoming disabled is 7 to 10 times greater than death at younger or middle ages.