Massachusetts State Life Insurance Practice Exam

When does the Waiver of Premium Rider typically become void?

1. Upon reaching 50 years of age

2. After a certain period of disability

3. After a certain age, usually 60 or 65

4. When the policyowner cancels the policy

The correct answer is: After a certain age, usually 60 or 65

The Waiver of Premium Rider typically becomes void after the policyholder reaches a certain age, usually around 60 or 65. This feature is designed to relieve the policyholder from paying premiums if they become disabled and unable to work, thus ensuring that the life insurance coverage remains intact during their disability. However, the rider is not meant to provide lifetime benefits; instead, it has a cut-off age that recognizes the reduced likelihood of disability impacting an individual's ability to work as they approach retirement age. This age limit is set to manage the insurance company's risk, as it aligns with the age at which many policyholders retire or have limited financial obligations, such as dependent children. Once the policyowner reaches this specified age, they are expected to be financially stable enough to resume premium payments or they may have alternative income sources, rendering the rider unnecessary. In contrast, the other options don’t accurately reflect when the Waiver of Premium Rider becomes void. For example, reaching 50 years of age might not correspond to the policy parameters, while simply having a certain period of disability doesn’t guarantee that the waiver will remain in effect indefinitely. Additionally, the cancellation of the policy by the owner is a separate action that would nullify all riders and benefits associated with the