Will my insurance pay out if I have coronavirus?
There are a number of different forms of protection insurance that are designed to pay out should you fall ill, but where do your policies stand when it comes to coronavirus?
What do we know about Coronavirus?
Coronavirus, or more specifically COVID-19 is a new illness which affects your respiratory system. It was discovered in December 2019 and was subsequently declared as a global pandemic.
The symptoms of coronavirus are typically a cough, a high temperature, shortness of breath, however having these symptoms does not necessarily mean that you have the virus.
The symptoms may appear similar to that of other more common illnesses such as cold and flu.
How will coronavirus affect my life insurance policy?
Whilst most people who fall ill with coronavirus will go on to fully recover, unfortunately there are some who have passed away due to the virus. Statistics show that the risk of death is higher in those who have underlying, pre-existing conditions.
If you die as a result of coronavirus, then this would be treated in the same way as any other cause of death. If it’s within the term of your policy, then your life insurance will pay out.
The main reason that life insurance claims are rejected is for non-disclosure i.e. being dishonest on your original application, such as omitting to tell the insurer about a pre-existing medical condition.
Is coronavirus covered by my critical illness insurance?
Critical illness insurance is designed to pay out a lump sum should you become critically ill. The conditions that are classed as critical would typically be listed on your policy, such as cancer, heart attack or stroke.
Although certain people will be more vulnerable to the virus, coronavirus is not classed as a critical illness in itself. Anyone can catch it, and with the majority of people recovering from the illness in under two weeks, it would not be something that you could claim for on a critical illness policy.
However, little is known about the long-term effects of coronavirus. If a subsequent, critical illness were to develop, then a claim may be made.
What about Income Protection Insurance?
Income protection insurance is there to help replace your income should you be unable to work because of an accident or illness. It provides a regular tax-free income, paying out until you return to work, or until retirement, whichever is soonest.
Income protection usually comes with a deferred period, which means your policy won’t pay out until after an agreed length of time has passed. The minimum is usually 28 days, but could be as long as 6-12 months.
If you are showing symptoms of coronavirus you must self isolate for 14 days – this could involve working from home if you are able to, however you may be too ill to work. With the majority of people recovering from the illness in as little as two weeks, this would be too soon for you to make a claim on your income protection insurance.
If you suffer long-term complications after being exposed to coronavirus, and are unable to work as a result, then an income protection claim could be made.
Can I take out a new protection insurance policy during the pandemic?
If you aren’t already covered but would like to protect yourself, then you are still able to take out any of the forms of insurance mentioned above. Please bear in mind that some insurance providers may have some additional questions, particularly relating to recent travel. In some cases, if you have recently had coronavirus or have travelled out of the country, an insurer may choose to defer the start of your policy for two to four weeks (similar to that of a quarantine period).
Applications may take longer to be processed, because of increased demand and a likely shortage of staff. If a GPs report is required, as is in some cases where medical information is required, this may add to the time taken due to the prioritisation of workloads.
If you have any questions about protection insurance or you are looking to take out a new policy, speak to our team of specialists at So Smart Protect today.