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.

Foodpanda Partners PolicyStreet

Foodpanda has partnered with insurrtech PolicyStreet to provide additional coverage for  to provide riders with additional financial support totalling to approximately RM200,000.

Delivery partner who tests positive for the virus will receive an additional RM1,000 from this initiative. And, should anything untoward happen, a death benefit of RM5,000 will also be paid out to the next of kin upon the death of a delivery partner from COVID-19.

This follows their earlier initiative to provided financial support to delivery partners impacted by COVID-19. Under the financial assistance measures rolled out by the Company, foodpanda will provide RM1,000 to any delivery partner who tests positive for COVID-19 and RM300 to any delivery partner who is quarantined due to the virus.

Shariah-complaint Financial Product During Covid-19

Gulf Cooperation Council (GCC) countries and Malaysia to help drive growth in Shariah-compliant financial products though the Covid-19 coronavirus may disrupt sukuk issuance.
Islamic finance is set to keep expanding in 2020 and beyond but the downside risks are rising which could dissuade issuers to come to the market.

Sukuk issuance to remain stable at around US$180bil this year, and the takaful insurance market will see steady growth as insurance premiums pick up in newly penetrated markets. However, downside risks are rising because of the coronavirus outbreak, as prolonged market disruption could dissuade issuers from coming to market.

Islamic financing asset growth will continue to pick up in 2020, underpinned by strong demand across core Islamic markets. Additionally, mergers between Islamic and conventional banks in the GCC will drive one-off increases in assets, as they did in 2019.

Saudi Arabia (A1 stable) will remain the world's largest Islamic banking market, while the sector will continue to expand rapidly in Malaysia. Sukuk issuance will stabilize after growing for four consecutive years.

Sukuk issuance is expected around US$180bil in 2020, after a 36% rise in 2019 to US$179bil. Continued focus on this industry and increased activity by the governments of the core Islamic finance markets, regionally and internationally, will support issuance. The deficit financing needs of some GCC sovereigns, amid weaker oil prices and higher sukuk refinancing, will also provide support.

Corporate issuance in asset-backed sukuk will remain limited because of more attractive conventional market opportunities. Nevertheless, sukuk issuance from these sectors could help to underpin the industry's longer-term potential.

Global demand and regulatory developments will continue to fuel growth in Islamic insurance. Global demand for takaful – Islamic Shariah-compliant insurance – driven by relatively low insurance penetration in Muslim countries, continues to fuel growth in premiums.

Continued pressure from weaker economic expansion to hinder, but not halt, growth in this sector which will remain propelled by demand and regulatory changes in the takaful regions that aim to foster appetite.

Deferment Premium For Life Insurance Only

The General Insurance Association of Malaysia (PIAM) said the deferment of payment for insurance policies, as announced by the government today under its economic stimulus package, only applies to life insurance and family takaful.

The deferment does not apply to general insurance policies, PIAM said in a statement. The association was clarifying an infographic that was being shared on social media. This, it said, has also been clearly indicated in a press release by Bank Negara Malaysia today.

"Life insurers and family takaful operators will allow affected policyholders and takaful participants an option to defer the regular premium/contribution payments due under life insurance policies and family takaful certificates for three months without affecting the policy coverage. This flexibility may be provided by life insurers and family takaful operators through a no-lapse guarantee, an extension of grace period or any other means that maintain the policy/certificate intact during the deferment period. This option will be available from April 1 until Dec 31, 2020,” BNM's statement read.

Cost Of Treating Covid-19

A trip to the hospital for coronavirus treatment may set you back financially by thousands. A recent report by healthcare cost database - which looked at the economic impact of the coronavirus pandemic on the healthcare system, found that a six-day inpatient stay for treatment of coronavirus symptoms would cost 100% of the price for someone without insurance: a whopping average of $73,300. (The same would apply if you stay in a hospital outside of your insurance network and your insurance plan doesn’t have out-of-network benefits.) 

There are 27 million Americans without insurance, despite the passage of the Affordable Care Act. The analysis considered nearly 18 million people under age 65 who used employer health plan claims.

The chart below looks at the estimated average costs per patient with COVID-19, per the report. It breaks down payment costs for professionals – individual health providers like physicians – and for a six-day inpatient stay for those with and without insurance. It also includes the average reimbursement amounts for Medicare and Medicaid patients, which are $10,561 and $7,533, respectively.

Those with insurance are estimated to have an average medical bill for the same duration stay of $38,221, but that doesn’t mean that’s how much they’ll pay. That is the rate negotiated between your insurance plan and your in-network health providers. How much you’d actually pay depends on your insurance plan.

To determine these cost averages, it reviewed the most commonly received treatment and professional services that patients with influenza and pneumonia in its sample size received. A respiratory illness, COVID-19 typically include shortness of breath in severe cases. But symptoms range widely across individuals, and treatment is often a case-by-case basis.

It’s possible that if you are hospitalized for COVID-19, you won’t undergo all of these procedures, might undergo different procedures, or could undergo additional procedures. So, you could owe less – or more – than what’s shown in the chart above, depending on your treatment.

But even if you aren’t hospitalized for COVID-19, testing and treatment could still cost a pretty penny. Normally a patient (based in the Boston area) tested positive for COVID-19 and is uninsured - would involved three trips to the ER before she was tested, resulting in a nearly $40,000 medical bill.

And two people who didn’t test positive, but received other related treatment and testing, received bills for over $3,000. Add up all these high medical costs for matters of life and death during a pandemic and you see a broken healthcare system at a time when Americans literally can worst afford it.

Vynn Capital Partners BIB Insurance Brokers

Vynn Capital, Southeast Asia’s leading early-stage venture capital firm, has formed a collaboration with BIB Insurance Brokers, an insurance brokerage firm.

With this collaboration, Vynn Capital and BIB aims to create more revenue streams for insurance companies, technology firms as well as traditional businesses by introducing new insurance and financing products that will benefit the value chain of economies

“We believe the recent virus outbreak, as well as the pace of market movements that have never been witnessed before, are not just impacting economies but have also changed our view on how we should live as human beings.

“As such, we need to breakdown walls and think out of the box on how we can leverage on innovation to create new ways to protect and enhance economies and societies,” Vynn Capital founding and managing partner Victor Chua said in a statement Tuesday.

To-date, Vynn Capital has invested into Malaysian companies such as Dropee and Carsome, both of which have already expanded their business coverage to offer financing services. The latest addition to the portfolio, Epost from Sabah, has also started offering insurance products to customers.

Vynn Capital believes that a partnership with BIB Insurance will result in better products and solutions for customers which can be provided to them in a more productive and cost-efficient manner. The venture capital firm also plans to bring more products and solutions to untapped markets such as Sabah and Sarawak.

PT Bank Rakyat Indonesia - Plans To Sell

PT Bank Rakyat Indonesia has revived its plan to sell a stake in its life insurance arm, which is attracting interest from suitors in a deal that could fetch about $500 million, according to people familiar with the matter. 

FWD Group Ltd., backed by Hong Kong billionaire Richard Li, and BNP Paribas Cardif SA are among potential bidders for a significant minority stake in PT Asuransi BRI Life, the people said. Prudential Plc and Samsung Life Insurance Co. are also weighing offers for the business. 

A transaction could also involve a so-called bancassurance partnership, which allows an insurer to sell its products through the bank’s branches, the people said. The state-owned lender has requested binding bids as early as next month, although the coronavirus outbreak could delay the process. 

Deliberations are ongoing and the companies could still decide against pursuing a transaction, the people said. This could be at least the third attempt by Bank Rakyat to sell a stake in the insurer. The lender tried to dispose a 40% stake in BRI Life in 2015. At that time, FWD and BNP Paribas Cardif were already among parties vying for the holding. 

In 2018, Morgan Stanley was hired to advise on the sale only to see process put on ice again last year. Any transaction would add to the $34 billion of announced deals involving Southeast Asian financial institutions in the past 12 months. That includes FWD’s $3 billion purchase of the life insurance operations of Thailand’s Siam Commercial Bank Pcl and Bangkok Bank Pcl’s $2.7 billion acquisition of a controlling stake in PT Bank Permata. 

Bank Rakyat was founded in 1895 in Purwokerto, Central Java. The country’s oldest lender used to be fully owned by the government until its listing in Jakarta in 2003. The bank had about 1,417 trillion rupiah ($87 billion) in assets in 2019, according to its latest annual report. The lender is seeking to boost its digital presence and allocate financing to unearth promising startups.