Since the coronavirus outbreak, the protection team at Alexander Hall has been fielding a number of questions from clients relating to both new and existing Life Assurance, Critical Illness and Income Protection cover options.
Clients are most commonly asking if protection policies are even still available. One of our expert protection advisers, Chelsea Warren, has compiled a list of these FAQs to provide some useful guidance, and give some understanding as to how the insurers the mortgage broker works alongside have responded to the crisis.
Should you have any queries relating to a new or existing policy, please contact the Protection Team on 08000 38 37 36 or use the contact us page on our website – click here.
Can I still get cover?
Yes. Most providers are business as usual. Demand is high at the moment therefore the application process may take longer than usual, but cover is still available to those who are eligible.
Some providers have adapted their underwriting processes slightly to allow for Coronavirus related questions. This is just to establish if you have experienced symptoms or have been tested for the virus. This does not necessarily mean you cannot get cover, even if you have suffered from the symptoms.
Due to the pandemic, some avenues of underwriting are not available at the moment (such as those where you will require a GP report sent by your local surgery) therefore there may be a limit to the cover that is available to you. This will differ from person to person, and from provider to provider.
The best thing to do is to speak to an adviser and they can guide you on who the best insurer might be for your personal needs. Even if you need to take a smaller amount of cover now, you will have the option to increase this later on, once the providers are able to carry out further medical investigations.
Will my policy pay out if I’ve had symptoms of Covid-19?
Yes. If your claim is valid under the standard conditions of your policy, it will be unaffected by whether or not you have had symptoms of or have been diagnosed with the Coronavirus.
If you are trying to apply for a new policy and you have had symptoms of, or have been diagnosed with Coronavirus, the provider may want to wait until you have been symptom free for a period of time before offering you the cover.
In most cases, once the cover has been accepted and has started, you will be eligible for any claim under the standard conditions of the policy.
Will protection cost me more now that Coronavirus has happened?
The cost of cover has not been impacted by the Coronavirus. Premiums are generally determined by your current health and other variables such as age, smoker status and the amount of cover you need. If you have any pre-existing health conditions, the cost of cover may vary. If you are generally in good health you can expect to get cover at a reasonable cost.
Even if you have suffered Coronavirus like symptoms but have fully recovered, cover may still be available to you without you having to pay more.
Will new policies have Coronavirus exclusions?
Life cover
Any new or existing policies will pay out on any claims linked to the Coronavirus, as long as the claim is valid under the conditions of the provider.
Critical Illness
Coronavirus is not a specified definition within a standard critical illness policy, however, any claims on critical illnesses that are covered under the plan conditions would not be affected, even if the illness is linked to or has developed from the Coronavirus. Any exclusions would be specifically stated in the policy conditions.
Income protection
Most providers will pay out if you are off work due to the Coronavirus or medically advised self-isolation. Most providers will consider the medically advised period of self-isolation as counting towards your total work absence.
The deferred period of the policy will of course influence when the payments start, and in most cases Coronavirus symptoms last two weeks or so.
Is there a limit to the amount of insurance I can now take?
In general, there is no limit to the amount of life insurance or the number of policies you can hold. Life insurance providers apply what’s called “automatic limits” on the amount of life insurance you can take with them.
This means that once you reach a certain age bracket there is a threshold of cover you can apply for without the need of any further medical evidence. This could be in the form of a short medical screening or a GP report being requested from the provider to your surgery.
With the strain that the Coronavirus is having on the NHS and medical companies at the moment, providers are capping the amount of cover to these “automatic limits” as they are not able to carry out any further medical investigations.
If you apply for cover above your automatic limit, the provider may postpone your application until they are able to conduct the investigations or in most instances, they may make a temporary offer of cover to you within the limits.
Providers are always looking to help their clients as much as possible, and we have seen many recently increase their automatic limits by up to 10% to ensure they can offer as much cover as possible.
Can I take a payment holiday on my monthly premiums if I lose my job?
There are several insurance providers that can allow you to waive your monthly premiums if you are made redundant under their “waiver of premium” terms.
If you are concerned about maintaining your insurance premiums as a result of being made redundant or furloughed, you should double check the terms of your policy or give our team a call and we can check this for you and advise you on your options.
The majority of insurance providers will allow up to three missed premium payments before they will lapse the policy, so if you do find yourself in financial hardship and you miss a few payments then the policy will not necessarily cease.
You may get the option to reinstate the cover as long as you make up any payments you missed. Naturally this would not be a recommended course of action to take as every insurer operates in a different manner, but do not hesitate to get in contact so we can guide you to the best resolution.
Bear in mind that protection policy terms and definitions of cover, are an ever-changing piece. We will ensure that all of our clients receive tailored advice on the most up to date range of options.
Please get in touch with us if you need any further advice. You can email us at [email protected] or use the contact us page on our website – click here.
This article was originally posted in What Mortgage online. You can see the original article here. Please note this will launch a new web page.
