It is not too much to say that this has been an uncertain year. With the spread of Covid-19 changing the way we approach life and business, we are learning how to keep safe and stay healthy. It has been a time where people are spending more time at home with their families while learning new ways to communicate with their coworkers and colleagues. It’s natural during a crisis to ask yourself “what if?”. For many, life insurance is the answer to that question. The virus has impacted all of us, and while life insurance in the age of Covid-19 has undergone some changes, the industry has been accepting applications and activating policy throughout.
How has the Pandemic Changed Life Insurance
The biggest change is that life insurance agents and advisors haven’t been having the face to face meetings with new and existing clients. Fortunately, the industry has leveraged technology to accommodate online applications and remote consultations. So while you won’t be opening the door of your agent’s office, they are still able to help you find the best policy for your financial goals.
In a new LIMRA study, online business for life insurance agencies in the United States and Canada increased significantly during this time. In all likelihood, the lessons we have all learned from this outbreak given rise to new ways to do just about everything.
What Type of Life Insurance Policy is Right for Me?
There are many factors that can determine the best policy for your life. Your age, health, income, family status, and financial goals all play a role in crafting a policy that suits you. A life insurance advisor can be a great benefit in sharing the latest insurance products and breaking down what each one can do for you.
During the current crisis, Term Life Insurance has been slightly more popular as it defines a set amount of time (or a Term) under which the life insurance covers you. A term of 5, 10, 20 years or more has lower monthly premiums than Whole Life Insurance and still provides substantial coverage.
There are life insurance policies that can accumulate cash over time, policies for end of life care, policies with flexible premiums and so many more. Doing your research online and speaking with an advisor will help clarify what’s best for you and your family.
Does Having Covid-19 Affect my Chance of Approval?
If you contracted the Covid-19 virus or have recently been exposed to the virus (on a cruise or after visiting countries abroad), some insurers may deny or delay your application until you have recovered or shown not to have contracted the illness. Each insurance company has been formulating their own policies regarding the virus. Some have added questions to their applications that pertain to Covid-19, and others have limited policies to seniors age 70 and older.
Insurance carriers base their application screening on risk to the insured. Covid-19 presents a new risk that the industry is still adapting to. Generally, however, if you are looking for life insurance and your situation is complicated, speaking to an advisor will let you know what options are available to you.
What About Medical Exams that Are Required to Apply for Life Insurance?
When applying for life insurance, a physical medical exam has often been required to assess the health of the applicant. Covid-19 has had a direct impact on this requirement. In the cases where an in-person exam is still required, strict safety protocols are followed by the examiner to ensure the applicant’s safety and remove the threat of exposure.
Additionally, there are some policies that can be done entirely online that do not require medical examinations. In many cases today, the insurer can forego the medical exam and ask more in-depth questions about the health of the applicant to assess the rates and premiums that they qualify for.
Does my Current Life Insurance Policy Cover Covid-19?
The short answer is…most likely. If you were honest in your application about your health, travel habits, etc. than nearly all life insurance policies cover an illness such as Covid-19. The exceptions would be if:
- There are inaccuracies on your application regarding your health, income, etc.
- Your policy was and Accidental Death Policy. Accidental death policies generally do not cover death in the case of illness or disease.
- Your policy has lapsed. If fyou fail to pay your monthly premiums, your policy may lapse. A lapsed policy is not in force and will not provide coverage.
We are in this Together
In our most trying times, people find ways to come together (even if remotely) to weather the storm. This outbreak will continue to shape us as people, neighbors, parents, and friends for years to come. It has given each of us pause to consider our own mortality and to think on the things that are most precious to us.
If you’ve been thinking about obtaining life insurance coverage to ensure the financial future of your beneficiaries, now is as good a time as any to move towards peace of mind and control what is in our power to control. Life can be uncertain but in these uncertain times, life insurance is something you can count on.
