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COVID-19

Certainty During
Uncertain Times

Getting concrete answers to allay worries about today’s state of uncertainty is pertinent these days. We have all the answers for you about life and disability insurance during the COVID‑19 pandemic.

Here are 8 of the most common insurance questions being asked during the Coronavirus outbreak.

Does life insurance cover Coronavirus? If you are candid on your application, then most likely you will be covered.
If your life insurance policy was purchased before implementation of COVID underwriting restrictions, it WILL cover coronavirus. However, here are several reasons why a death benefit would not be paid out:
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An insurance company may refuse to pay out the death benefit if the applicant was untruthful on the application.
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If the applicant did not submit a complete application or did not pay the life insurance premiums.
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People who only purchased an accidental death policy may not be covered for coronavirus.
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Life insurance companies may refuse death benefit payment to the applicant’s beneficiaries if information was held about travel to high-risk countries.

We suggest being honest forthright when applying for life insurance and during the underwriting process.
Have the insurance application process and underwriting procedures changed?Yes.
Life insurance carriers have established temporary guideline changes to help navigate the risks associated with the pandemic, while also making changes to facilitate business in a more efficient and effective manner. These include fluidless/no exam/accelerated underwriting.
Meanwhile, the process is already changing, albeit slowly. Life insurance companies don't like risk, and now, the risk is all around them. COVID-19 is a previously-unknown disease, so underwriters can't refer to historical statistical data to assess the risks of those who have it.

In practice, this means that there are a few changes to the life insurance application process:
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Obtaining medical records from doctors is now taking longer than it usually does. This may be problematic for applicants who need their records to get approval, which is why many insurance companies are pointing applicants to no-exam life insurance policies.
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Due to increased transmission of COVD-19 in certain countries, carriers are following the U.S. Department of State’s health advisory guidance for foreign travel risk associated with the pandemic. Individuals returning from or planning travel to high risk countries may be postponed.
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Life insurance companies are adding specific questions on the application about whether the person had/has COVID-19 or has come into contact with someone who has it. Life insurance companies may deny an application if the person has coronavirus.
Will travel history affect premiums?Premiums have not been affected by travel history, but approval of new applications is being affected.
Many applicants who have traveled globally are having their applications postponed by life insurance carriers and being told to apply in a few months.
Can you get life insurance if you are unemployed?It is not impossible to get life insurance if you are unemployed, but it is not easy.
It is not easy to get life insurance if you are unemployed, regardless of coronavirus. Life insurance companies may not favor these applications because there is no guarantee that unemployed people will be able to make their monthly premium payments. Your chances are better if you apply for term life insurance as opposed to whole because term usually has lower premiums.
Does disability insurance cover COVID-19? Short-term disability insurance does cover COVID-19, but long-term disability most probably will not.
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Short-term disability insurance should cover COVID-19 and coronavirus-related illnesses if they render you unable to work. Your claim may need to be verified by a medical professional to be approved. Similarly, you can qualify for short-term disability benefits if you are in a medical self-quarantine related to coronavirus. A medical quarantine means you already have a medical condition that prevents you from going to work.
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Long-term disability insurance benefits can only be applied for if you can't work for 90 days or more.
Can you apply for disability insurance if you've contracted COVID-19?NO.
No. If you've already contracted COVID-19 (or any illness), you cannot apply for disability insurance to cover that illness. That's why we suggest applying for disability coverage when you are healthy.
Do you need life insurance if you have a will?A will and life insurance are two entirely different things, and both are necessary to protect and alleviate the lives of your loved ones after your death.
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A will is a legal document that includes instructions for distributing the assets in your estate. The death benefit from a life insurance policy is not considered to be part of your estate, since it's only payable upon death. Upon death, it goes directly to the beneficiaries named in your policy.
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A will does NOT supersede a life insurance policy. If you name your children as the inheritors of your estate, but your partner is listed as the life insurance beneficiary, your children will NOT get that payout.
Does the stock market influence your life insurance? It depends on what kind of life insurance you have.
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If you have term life insurance, the stock market will not affect your premiums. The cost of your policy stays the same regardless of market fluctuations.
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Permanent life insurance, on the other hand, may be affected by the stock market, since they often work partly as an investment or savings plan and may have access to dividends which are often affected by the overall markets.

Don’t risk your life.

Thinking about life insurance now? Let us help you during this difficult time.
Sproutt’s teams across the country are ready to answer your questions and review your applications. Don’t hesitate to contact us now.
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Tips, tools, and articles for these times.

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