I have fielded many calls and emails these last 8 weeks and by far the most frequent question that clients have asked has been:
Will my insurance payout should I be diagnosed with Coronavirus?
Things continue to evolve, so some of this information may change; however, below is a summary of how Coronavirus is currently being handled on the life and health insurance side, and what to expect in the future:
1. Disability Income Protection
Should someone be unable to work for an extended period of time as a result of Coronavirus, they could potentially qualify for a monthly payout. They would need to:
- Satisfy the waiting period: for short term disability that is 1 week, for long term disability that is 30-119 days depending on your plan
- Qualify on the other criteria (for example- can they not perform the normal activities of their occupation?)
- Be actively employed, not on temporary layoff
2. Critical Illness Insurance
Is Coronavirus currently a covered condition? No.
However, someone who contracted Coronavirus may subsequently develop health issues that could lead to a critical illness that is covered under their plan, such as coma or organ failure (click here for a list of covered conditions).
3. Life Insurance
Should someone be diagnosed with and die as a result of Coronavirus, life insurance would pay out- there are currently no exclusions on anything Corona related.
Be aware that all insurance policies have what is called a 2-year contestability period. If someone were to die within the first 2 years of taking a new policy, the insurer has the right to investigate and ensure that all answers provided at the time of application were true and the client disclosed all relevant medical history.
4. Group Benefit and Individual Health & Dental Plans
If someone is hospitalized or needs medications due to being diagnosed with Coronavirus, health plans do cover certain medical expenses for this illness. You would need to check with your specific provider as to what the terms of your plan are to know exactly what you are covered for.
What changes can we expect in the future?
Insurers will be revising their applications, adding questions about exposure to or being diagnosed with Coronavirus, since there are long term health issues (respiratory, etc.) associated with those who have suffered from this illness. This will affect one’s insurability moving forward, insurers could potentially require higher premiums or decline the application for coverage.
The good news is…..
Insurers have temporarily relaxed their guidelines, making it easier for healthy Canadians to get approved for insurance- no medicals required and higher limits of coverage. Anyone needing additional life, disability, or critical illness insurance and does not have health issues, now is a great opportunity to secure the best coverage and rates.
Do you have questions about your existing insurance coverage or need additional Life, Disability or Critical Illness coverage? Book a call here.