Waiver of premium is a valuable benefit that allows employees who are unable to work due to a disabling condition to maintain their group life insurance coverage without making premium payments. Because the process for obtaining this benefit varies, here are some questions to consider when evaluating carriers.
Questions to consider when evaluating waiver of premium benefits
1. How long is the elimination period? During the elimination period—typically 6 or 9 months—the carrier determines if an insured is eligible to receive waiver of premium benefits.
2. What are the age limitations for waiver of premium benefits? In most cases, policies limit waiver of premium benefits to individuals under a certain age. Make sure to review the carrier’s policy to ensure you know what these limits are.
3. When should a waiver of premium benefit claim be submitted? A claim for waiver of premium benefits should generally be submitted when an insured has been continuously off work for the duration of the carrier’s specified elimination period.
4. How are premiums paid during the elimination period? This can vary among carriers, so it’s important to read through the group life insurance certificate or consult the carrier to determine whether and how premiums should be paid during the elimination period.
5. What information is needed to file a waiver of premium claim? Most carriers will ask for the following information to process a waiver of premium claim:
- Date of hire
- Effective date
- Coverage class
- Social Security number
- Employment termination date (if applicable)
Other supporting documentation that may be required include an Attending Physician’s Statement (completed by the claimant and their treating physician), and an Authorization for Release of Medical Information form which the claimant also completes.
6. What is the definition of disability? Carriers define disability differently, so what may be covered under one policy may not be covered under another. It could also be the case that an insured is considered disabled by their short- or long-term disability insurance policy, but not considered disabled for the purpose of the waiver of premium benefit.
7. What if an employer transitions to a new group life insurance carrier during an insured’s elimination period? Provisions in both carriers’ certificates should address whether the new or prior carrier is responsible for any applicable waiver of premium benefits. These provisions should be carefully reviewed to make sure the claim is filed with the correct carrier.
8. What happens if waiver of premium benefits and long-term disability benefits are adjudicated by different carriers? Claimants may need to submit information to each carrier separately, which could mean duplicating efforts. If a group’s life insurance policy and long-term disability benefits are provided by the same carrier, claims teams can more efficiently confirm key information like the insured’s last day worked, age limitations and whether the condition passes the certificate’s definition of disability. Plus, employers would only need to communicate with one carrier.
Managing claims for waiver of premium benefits can be complicated. Be sure to read our Inside Track educational paper and contact your group benefits representative for more information.
