Life insurance and the COVID -19 Pandemic
Life insurance and the covid-19 pandemic relationship must be considered if you are looking to obtain life insurance during these uncertain times. By November 11th, 2020, the total number of COVID-19 cases in Canada was 279,000, with the highest number of Quebec and Ontario cases.
According to a Canadian Institute of Actuaries report, life insurance claims increased in April and May 2020, from roughly $442 million in 2019 to $502 million. However, the CIA says this increase falls within the volatility range insurers are prepared for.
As Canada grapples with a second wave, COVID-19 related deaths increased to 244 in the first days of October, compared to 171 deaths in the whole of September. November is not faring any better. The implications of the virus’s unprecedented spread have left many wondering how their life insurance policies are affected.
What is COVID-19, and how to recognize its symptoms?
Life insurance and the Covid-19 pandemic, this new strain of the coronavirus was first identified in December 2019 in Wuhan City of China. The new virus was named SARS-CoV-2, and it causes COVID-19. Coronaviruses are common in humans, and they usually cause mild illnesses in people, very much like the common cold.
Even though some people are asymptomatic, others have severe symptoms that can even lead to their death. These symptoms include fever, a persistent cough, difficulty in breathing, and pneumonia. The elderly, people with chronic conditions, and weakened immune systems are more at risk of having severe symptoms. The global outbreak was declared a pandemic by the World Health Organization (WHO) in March 2020. Since then, global fatalities have reached almost 1.3 million.
How does COVID-19 affect your existing life insurance?
If you have an existing life insurance policy, you are covered for any COVID-19 claims. This is because your life insurance policy is a contract between you and your insurer. Your insurance company has agreed to pay out a lump sum tax-free to your beneficiaries in exchange for your premiums. The money is paid whether you pass away due to an accident or illness during the policy’s duration.
Therefore, if you were to pass away, either because of COVID-19 or any related illness, your beneficiaries will be paid out. The claim is not to be treated any differently to a death caused by natural causes or any other infectious disease.
What happens with a deferred life insurance policy?
If your policy is deferred because of prior health considerations, then a COVID -19 claim will be considered after the pre-deferral period. It will be treated in the same manner as other causes of death by an illness after the deferral period has ended.
How does COVID-19 affect new insurance policies?
So far, no adjustments have been made for coronavirus risks to life insurance products in Canada. Once approved, new life insurance will provide coverage for a COVID-19 related death.
The insurer may defer the approval of a new life insurance policy if you have recently been diagnosed with COVID-19 or receiving treatment for it.
How does travel affect your life insurance application?
Most life insurers always ask questions about travel in the year before taking out life insurance and about future travel plans for up to a year. If you have been to a region with a high number of COVID-19 cases or are planning to go, you can expect additional questions. Some companies may opt to postpone approving your policy.
Can a Critical Illness Insurance Policy pay a COVID-19 claim?
COVID-19 is not defined as a critical illness in current Critical Illness Policies. These usually pay out a lump sum after a pre-ordained survival period of a critical illness, and most people have a relatively short recovery period. If the virus leads to a severe condition, insurance companies usually consider it a condition they cover.
What about disability insurance payments?
Depending on the minimum waiting period of your disability insurance, insurance companies may make a payment for loss of income if you are diagnosed and can’t earn an income. Some companies even waive the waiting period.
How could the pandemic affect future life insurance policies?
Currently, most life insurance policies only have exclusions for suicide or criminal activities. However, even though they now have no disease-related exclusions, even on coronavirus-related deaths, they are likely to monitor the course of the outbreak closely and adjust their products if necessary.
Life insurance and the Covid-19 pandemic! Is this a good time to buy life insurance?
The earliest you buy life insurance, the cheaper it is, and you can offer your family protection. This pandemic is a reminder that life insurance provides secure coverage in turbulent times. If you are considering life insurance right now and social distancing, there is no reason you cannot speak with your broker on the phone. You can also look online, where most life insurance companies and brokers offer life insurance needs calculators.
Life insurance and the Covid-19 pandemic might be overwhelming, but AplusWealth Inc. is here to help!
An expert advisor is the best person to help you secure your family’s financial future and guide you to find the best life insurance type. A financial advisor or insurance agent will assess your financial needs, look at the existing life insurance policies you may have. They will find a way to cover all your life insurance needs within your budget.
Life insurance and the covid-19 pandemic process are done entirely online. Thanks to our expert advisers who are entirely comfortable with the online life insurance & investment platform, you can take advantage of their expert opinion about if nothing has changed by taking your age, and health, liabilities, and goals into consideration. At Apluswealth, you can get a quote, compare quotes, and find the life insurance quote you feel comfortable with. Our life insurance advisors will provide you with quotations and the most suitable policy types.
Contact our expert advisers today and find out which is the best life insurance for you.
Email: Contact@apluswealth.com
Tel: 1-888-461-6120