What is the 'waiver of premium' called on a Universal Life Insurance policy?

• A. Waiver of Premium
• B. Waiver of Cost of Insurance
• C. Disability Benefit Rider
• D. Premium Benefit Rider

Answer: (B)

In Universal Life, the charges that can cause a policy to lapse aren’t a fixed premium but the cost of insurance (COI) charges, along with other small expenses. To keep the policy in force if the insured becomes totally disabled, the insurer can waive those COI charges through a Waiver of Cost of Insurance rider. This means the policy stays active without the owner needing to pay the ongoing COI out of pocket.

This is different from a simple Waiver of Premium because UL doesn’t rely on a fixed premium in the same way as some other policies; the important protection is waiving the COI charges that would deplete cash value. A Disability Benefit Rider would typically pay benefits if disabled, rather than waiving the ongoing COI charges. The Premium Benefit Rider isn’t the standard terminology used in UL for this feature.