Protect your Loved ones during the pandemic- Does life insurance cover the coronavirus?
In 2020, We were all in this together and trying to get through this crushing weight of COVID-19. During that time, while the pandemic was eroding the U.S. economy, life insurance companies were slightly adjusting their rules. Keep reading to find out how COVID-19 is affecting the life insurance application process, approval procedures, and death claims in 2021. Most importantly, learn tips on how to prevent your current coverage from lapsing.
How does coronavirus affect life insurance coverage?
First things first, insurance companies will not deny claims for deaths caused by the coronavirus. If you have a valid plan in place, you will be able to breathe a sign of relief knowing your death benefits will not be cancelled. The pandemic cannot affect the agreed-upon conditions of your active policy. There is no need to fret, all coronavirus-related expenses will be covered.
The only way an insurance company may deny your claim is when you give false information on your application or fail to pay premiums. Concealing the truth about your travel or health conditions when filling out the insurer’s form is likely to result in the rejection of your death benefit. Remember, being honest is the best safety net.
Term Life vs. Permanent Life Insurance
Term Life Insurance – If you fail to pay your premiums on time, you will not lose your coverage right away. Most insurers will allow for extended grace periods during the pandemic for 30, 60, and sometimes even 90 days. Once your grace period is over, your term life insurance policy will lapse, and you will lose your benefits. However, you may still reinstate your policy by paying your past due premiums and completing a reinstatement application.
Permanent life insurance – You may decide to let the cash value temporarily pay your monthly premiums. This will keep your coverage active until you are able to pay premiums again. However, if your financial situation becomes worse, you may decide to reduce your death benefit as outlined in the “Reduced Paid Up Option” section of your policy; and this will allow you to keep a portion of your life insurance in force, instead of losing it all.
Can I get life insurance during a pandemic?
Despite this COVID-19 buzz, now is probably the best time to invest in life insurance. More insurance carriers are now offering phone applications and electronic approval. Additionally, rates have stayed the same despite the pandemic, and the online application is now a simplified process. Thus, you can complete all forms online and save a great deal of time and money while ensuring your family is protected financially.
Please note, eligibility criteria for life insurance has been changing. Some insurance companies are now asking COVID-19 related questions on application, and some are imposing new age-related limits. If you have tested positive for COVID-19, your application may be postponed until your test results come back negative. In this case, may be required to wait longer until your application is re-considered. However, if you don’t develop any signs of the disease, you shouldn’t worry.
The Bottom line
As you can see, things have not changed that drastically. If you do not have COVID-19, life insurance can be obtained even easier than pre-pandemic. If you have tested positive for COVID-19, you will be required to wait a bit until your test comes back negative. In the meantime, don’t forget to compare plans and rates on our website from different insurance carriers.
How Severe is the COVID-19 pandemic in 2021?
IN August 2020, more than 170,000 people in the U.S. had died from coronavirus. As of July 2021, more than 600,000 people have passed away from coronavirus related diseases. Now, as lockdown restrictions have been lifted in the U.S., cases continue to surge as new variants continue to infect people. Fortunately, more than 45% of adults have been vaccinated, and new deaths continue to be very low. See table below to see casesc data per state.
