Coronavirus Is Covered Under Life Insurance

Thousands of people worldwide have been infected or died from COVID-19, the disease caused by Coronavirus. For those who have life insurance, in almost all cases, they are covered, and insurance will likely pay out for deaths from COVID-19. There are a few exceptions, according to representatives from life insurance companies and industry organizations.

Traditional life insurance policies, such as whole and term life, likely cover deaths from COVID-19. However, there are a few exceptions. For example, an insurer might deny a claim for a coronavirus death if the policyholder:

Submitted an inaccurate or incomplete application - Claims can be denied for reasons like not disclosing travel plans or lying about weight or income. If you die within the first two years of coverage, an insurer generally examines the claim and initial application more thoroughly. Still, a company can refuse to pay a claim if false information is found on the application even after the two-year life insurance contestability period ends. When filling out an application, take your time, be truthful and ask questions if you don’t understand what is being asked.

Didn’t pay insurance premiums - If your policy lapses for nonpayment and you die before the policy is reinstated, your beneficiary usually won’t receive a payout. When a premium payment is late, life insurance companies often offer a grace period of 30 or 31 days. Your coverage will continue as long as you pay the insurer during this time. Insurers may extend this grace period during the coronavirus pandemic — some state regulators are requiring it. If you’re having trouble making payments, contact your insurance company before your premium is late. Otherwise, your insurance coverage will end until you apply for reinstatement and your insurer agrees. To qualify for reinstatement, you may need to prove that you aren’t a risk to insure.

Bought only an accidental death policy - Accidental death and dismemberment insurance, or AD&D, is designed to cover accidents. It doesn’t pay out if you die of illness or disease. Sometimes AD&D coverage is added to a standard life insurance policy as a rider. In that case, the underlying traditional policy would still pay out for a death from COVID-19.