Does Life Insurance Cover Coronavirus?
As the coronavirus pandemic continues to spread, many people are starting to ask if their life insurance policy covers death due to coronavirus.
Many others, who don’t have coverage, have been scrambling to purchase a suitable life insurance policy. The added risk of death caused by the coronavirus pandemic is complicating things, but getting coverage is still possible.
One of the major problems that both underwriters and those looking to get coverage are facing is the uncertainty that we currently find ourselves in. The situation that the coronavirus pandemic has produced is very fluid, with things changing quickly as we learn more.
This means that acting fast and staying updated are two of the most important things you can do right now when it comes to your life insurance coverage. Following the advice of medical professionals can also help you stay safe and increase your chances of getting insured.
In this article, we will be answering if life insurance covers coronavirus as well as what to expect if you’re looking to take out a new policy during the pandemic.
What is coronavirus, and why is it a pandemic?
The World Health Organization (WHO) tells us that coronaviruses are a family of viruses that includes the common cold, MERS (Middle East Respiratory Syndrome), SARS (Severe Acute Respiratory Syndrome), and COVID-19 among others.
The COVID-19 disease is an infectious disease that is caused by the newly-discovered coronavirus. Most people who get infected will experience what is best described as a mild to moderate respiratory illness. Those who are of older age or have underlying medical issues are more likely to experience serious illness, which can also lead to death.
Coronavirus is considered a pandemic because it’s a new disease that is spreading across the world at an alarming rate. Epidemics are usually constrained to one specific region.
Do life insurance companies cover pandemics?
The quick and short answer to this question is it depends on your life insurance policy. Let’s look at this in more depth.
All life insurance policies are covered by a policy declaration page, which states what you are covered for. This will generally depend on the type of policy you have and the premium you pay. As each policy is different, you will have to go through your policy’s declaration page to see if coronavirus or pandemics are excluded or not.
Having said that, most existing life insurance policies do include pandemics. In fact, it’s quite rare for policies to not include illnesses such as coronavirus. If you are looking at taking out a new policy, in light of recent events, things might be different.
This is due to a number of insurance companies that have started to include exclusion riders that exclude death due to coronavirus disease. If you’re looking at taking out a new life insurance policy, continue reading to learn more about what you can expect and things to look out for.
If you have group life insurance at your place of employment, you should also check with HR if coronavirus-related illnesses are covered by the policy.
- Pandemics are generally covered
- Refer to your declaration page for confirmation
- Be aware of any exclusion riders
Will insurance companies be able to pay out in the case of a coronavirus death?
This is not the first time insurance companies have had to deal with something like this. Throughout history, we have faced a number of challenges and insurance companies have always been able to pay out.
It’s worth noting that many of the insurance companies we see today have been around for over a century. During this time they have had to deal with major events such as pandemics, natural disasters, and other tragedies.
The information we have now shows that seniors are more likely to be severely affected by the coronavirus disease. These policyholders tend to be covered for lower amounts than those of a younger age.
his means that as things stand at the moment, the average payout due to coronavirus death will be on the lower end, leaving insurance companies with enough cash to pay out most valid claims.
- Insurance companies are designed to handle cases like this
- Choose a strong insurance company for extra peace of mind
- Policyholders with lower coverage are most at risk
What can invalidate my life insurance policy?
One concern that many people have is whether any action taken on their part, such as traveling, can invalidate the policy.
Be sure to check the declaration page as well as any additional riders on your policy. The short answer to this is that as long as you were truthful during your application process, your policy should not be invalidated by any traveling you might have done. If you already have a policy, you should be covered. To be certain, make sure you check your policy’s declaration page and any extra riders tied to your policy.
One other thing to watch out for is what is known as the contestability period. Standard with most policies, this is a period during which the insurance company can investigate any claims you made during your life insurance application. If your version of the truth does not tally with what the insurance company uncovers, your beneficiaries might receive a lower payout. In certain cases, the payout might be denied outright.
- The policy will remain valid as long as you abide by the terms
- Answer any questions truthfully to avoid payout denials
- Refer to your policy for applicable terms
Can I apply for life insurance now?
At this time, you can still apply for and get a life insurance policy from virtually any underwriter. There are a few things that you might need to consider which we will be covering shortly. You also need to keep in mind that the situation is very fluid.
The pandemic is still progressing. This means that life insurance underwriters may change their criteria as new information comes to light. The important thing here is to act fast and apply as soon as possible.
- If you have tested positive for coronavirus in the past your application may be postponed
- If you are symptomatic your application may also be postponed
- Traveling outside of the US or to a high-risk area might invalidate your policy
Of course, any restrictions in place before the pandemic hit are still in place now. It might be worth keeping in mind that any existing medical issues that might increase the likelihood of severe coronavirus symptoms might be taken into account when determining your premium.
As we discussed earlier, some insurance companies have started to add exclusion riders for coronavirus-related deaths. The situation is still evolving, and if it does get worse, carriers might stop issuing new policies until a vaccine becomes available.
How to get life insurance
There are different ways to get life insurance, which fall into two categories – direct or through an agent. As the pandemic continues to progress, it might become hard to find a physical office to go to. This means that your best bet is to find a life insurance policy online.
The important thing here is to make sure you get multiple quotes from different providers and compare prices as well as the coverage you get for the price being quoted. If you decide to go through the direct route, you will need to shop around yourself. If you go through an agent or use an online comparison site, the work will be cut out for you.
You might also want to consider applying for temporary coverage. A number of life insurance companies offer this type of coverage so that beneficiaries can still get something should something happen to you during the application process. This can be a wise choice now more than ever as we are seeing longer waiting times for approval.
What type of coverage should I get?
If you’re looking at getting coverage, now is the best time to do it. As this pandemic is still evolving, things are changing very often.
We are already starting to see some changes in the process, including:
- Longer waiting times
- Added restrictions
- Higher premiums
Regardless of which type of policy you go for, make sure you do your homework beforehand. This will help you get enough coverage to ensure the safety of your loved ones should the worst happen.
Pay special attention to any additional riders and the declaration page to ensure you are covered for coronavirus-related death.
Will I need to sit for a medical exam?
There are a number of life insurance providers who offer no exam life insurance policies.
This might actually be the only option available as stay-at-home restrictions might limit the availability of physical contact. A no-exam policy will typically have higher premiums and lower coverages.
Even so, this is your safest option at this time and is recommended if you do not have coverage.
- Expect higher premiums for no-exam coverage
- Safest option due to social isolation requirements
- Answer truthfully to avoid disqualification after
Applying for life insurance if you’ve tested positive to coronavirus
If you have tested positive for coronavirus, you can expect your application to be put on hold. Some insurance providers are delaying the processing of life insurance for those who have tested positive for coronavirus by as much as a minimum of three months.
Even if you have made a full recovery, failing to disclose this information when asked may see your policy invalidated during the contestability period, which can last up to two years.
Should You Get Life Insurance During The Coronavirus Pandemic?
As the coronavirus pandemic continues to spread, taking the necessary precautions to safeguard yourself and your loved ones is very important. Life insurance can provide you with a financial cushion to soften to blow should the worst happen.
Getting a life insurance policy now can still help you get coverage, even if this comes at a higher premium or does not cover as much as you would like it to.