AD Banker Comprehensive Practice Exam

If an insured with a waiver of premium rider changes to a more hazardous occupation, the insurance company will:

1. Void the policy

2. Continue the waiver of premium rider

3. Increase the premium

4. Cancel the waiver of premium rider

The correct answer is: Continue the waiver of premium rider

The correct perspective on this scenario is that when an insured individual has a waiver of premium rider, it generally means that if they become totally disabled, they will not have to pay premiums during their period of disability. Changing to a more hazardous occupation does not typically negate the terms of the waiver of premium rider. The waiver of premium rider is designed to provide financial protection for the insured during times of inability to work due to disability, regardless of occupation. While switching to a more hazardous job may pose additional underwriting risks for new policies or adjustments, it does not automatically affect existing riders unless specifically stated in the terms of the policy. Therefore, the insurance company would not cancel or alter the waiver of premium rider based solely on the insured's change in occupation to a more hazardous one, allowing them to continue benefiting from the rider's provisions if they meet the conditions for total disability.