Will Life Insurance Payout For Coronavirus Pandemic?
If you are one of the millions of Americans affected by the COVID-19 outbreak these days, then you may have had one single piece of optimism based on the fact that even if something happens to you, you have taken out life insurance to make sure that your family is taken care off. But seeing how so many people out there are affected by the coronavirus pandemic at the same time, will life insurance payout if something actually happens?
After all, it would not be super strange to suddenly find that your contract contained some kind of weird clause that said certain events or causes of death do not qualify for being covered by life insurance. So, will life insurance payout for coronavirus pandemic deaths? As more and more people are set to die from COVID-19 all around the world, and with the United States quickly becoming one of the epicenters of the outbreak because of weeks of lost time by the Trump administration, questions such as these are unfortunately more relevant than ever.
At the same time, if your main worry is if your life insurance will cover a death caused by COVID-19, then the answer is usually yes. In the large majority of cases, your life insurance is going to pay out for deaths that are the result of COVID-19. However, there are still some exceptions to keep in mind, so do yourself a favor and check on those just to make sure that you or your loved ones are not in for a nasty surprise should the unthinkable happen.
1. Rejection due to inaccurate or incomplete applications. Now, this is a common reason why life insurance payouts can be rejected and it is not limited to this outbreak of COIVD-19. However, now that there may be a lot more people who are filing for the payout of their life insurances, insurance companies are likely to look particularly closely at your forms in order to see if they can get out of having to payout.
The main thing to look out for here is that it is crucial for you to give the insurance correct statements about your weight and income. On top of that, never lie about your travel plans. It is important to always disclose them, otherwise, they may be seen as a violation of your contract and could be cause for termination. Now, if your life insurance has been running for a couple of years now, then the scrutiny of insurers likely is not going to be that massive.
But if yours is more recent than two years or so, being super accurate with your statements is especially important. So, make sure that everything is disclosed and this point should not be an issue for you, which means that your life insurance will payout for coronavirus pandemic deaths. That is, unless the next exception applies to you:
2. Missed premium payments. As you can see, reasons, why your life insurance will not payout for coronavirus pandemic-related deaths, are mostly the consequence of things that would be an issue with payouts anyway, even without COVID-19. But this one is also important. If you miss premium payments, then your policy lapses due to nonpayment. This means that for as long as the policy has lapsed, it is as if your life insurance does not exist. If you pass away during that time, then your beneficiary is not going to receive anything.
Now, if you just missed your premium payment a few days ago, ideally just go and pay it now. Most of the time, there are grace periods of around 30 days and if you pay during that time everything will continue as normal. It could even be that your insurer has a special policy in place that extends this grace period because of the ongoing pandemic. But if you already know that your payment is likely going to be late, make sure to talk to your insurer now. That way you can take advantage of possible support programs. Otherwise, you may lose coverage, and getting it back in these times may be a real struggle.
3. You have an ‘accidental death’ policy only. Finally, it could be that your life insurance will not payout for coronavirus pandemic cases simply because it is not specified within your policy stipulations. There is this thing called ‘accidental death and dismemberment insurance’, also referred to as AD&D, which is specifically for accidents. Dying from a disease or illness is not covered by AD&D policies alone, so if you only have that, you are not going to be covered. At the same time, in many cases, an AD&D policy is added on to traditional life insurances, in which case your life insurance is still going to cover you for a coronavirus pandemic death.
Okay, so if none of these three exceptions apply to you then you should be able to rest easy at night knowing that whatever happens, your loved ones are going to be okay.