When the pandemic hit the US, life insurance activity also accelerated. According to CNBC, the insurance application activity saw a 1.5% increase during the first half of 2020—compared to the previous year.
As far as Americans under 44 are concerned, the rate of applications increased by 3.4%. Let’s delve into it.
Did the pandemic affect the life insurance industry?
The good news is that when most businesses in the US had to pull out of the market, the life insurance sector remained largely unscathed. The premiums remained steady, and most companies managed to pay their COVID-related claims.
As we enter 2021, life insurance is still available to buy. However, the underwriting process and the application time has become more extensive. You can now expect the insurers to ask more questions and be a little more stringent with the policy formulation process.
What to expect from life insurance in a pandemic world?
According to Forbes, most life insurers are now asking policy applicants whether they’ve tested positive for COVID-19 in the past 30 days, whether you had any symptoms and were asked to isolate, or if you were in direct contact with someone else who tested positive. If the answer to any of these questions is yes, your application could be postponed—by around a month. If the symptoms are severe, the application process could take even longer. We recommend you to be as honest with the insurer as you can. If you don’t disclose any pre-existing conditions w.r.t. the coronavirus, your application could be rejected.
Even if you have a pre-existing condition, it doesn’t mean your application will not be accepted. The insurers have just become more selective. If you’re over 50 and have an underlying respiratory condition, they may charge you higher premiums. In some cases, the insurer may even ask for detailed medical reports and in-depth consultation with your GP for a clearer picture of your condition.
Why do you need life insurance during a pandemic?
Life insurance ought to be an essential aspect of your financial planning process.
When human life has become increasingly unpredictable and uncertain, you need the policy to protect your family from financial instability that results from a healthcare condition. The COVID-19 isn’t just about over the counter painkillers. Severe symptoms may result in the need for ventilators, ICU units, and oxygen supplies—all of which result in considerable expenses.
A comprehensive life insurance package also provides additional counseling and financial consultation. SJG Financial Services is a wealth management advisory service from Santiago that also offers life insurance to take care of you and your loved ones. Get started now.