20/03/2020 0 Comments
Covid-19 - Will Serious Illness Cover, Life Assurance & Income Protection Policies Pay Out?
Most people buy insurance policies such as Serious Illness Cover, Life Insurance & Income Protection to give them peace of mind in times of uncertainty. It’s difficult to think of any time more unprecedented and uncertain than 2020.
We have been contacted by many of our clients to find out where they stand in terms of their insurance cover should they contract Coronavirus, so we will try to answer the most frequently asked questions here. All policies and insurers have their own terms & conditions, so it’s vital to check each individual policy.
Serious Illness Cover
Serious illness cover (also called specified illness cover) pays out a tax-free lump sum in the event of you being diagnosed with an illness that is specifically covered by your policy. Most policies will cover on average 50+ serious illnesses. It will not pay out as a result of Coronavirus as it is not a specified illness on policies, and also most people who contract it, thankfully make a full recovery. Clients who end up with a serious lung condition following the illness may be able to put in a claim (this depends on the wording of your specific policy).
If you are currently looking to take out Life Cover, the Insurance company may enquire about your recent travels, and potentially postpone your case until they are sure that you are not at increased risk. This process may differ amongst providers.
With rare and extremely sad cases where the person dies as a result of Coronavirus, their Life cover will pay out (providing there was full disclosure made on the original application)
We have had an increase in enquiries from existing Income Protection clients as to whether their Income Protection policy would pay out if they were unable to work as they had contracted Coronavirus.
The terms and conditions of each Insurance Company would apply, but in general once the chosen deferred period has been completed and the client is still off work due to the effects or complications of the illness, then the policy would pay out.
Income Protection only covers clients if illness or injury prevents them from working. If they are forced to stop working, maybe because an employer has laid them of or because they have been advised to self – isolate, the policy unfortunately would not pay out.
If you are considering taking out Income Protection, it is important to be aware that insurance policies will not cover for illnesses you are already aware of. So if you are awaiting a test for Coronavirus, or have any of the symptoms, your cover would be postponed.
If Covid-19 has shown us anything, it’s that circumstances and events can move so fast, so keep an eye on our website & social media platforms for updates.
As always if you have any queries in relation to any of this, please pick up the phone and organise a consultation with our Dublin income protection brokers today.
Helen Connor O’Neill - Financial Advisor - Citywide Financial
Phone: (01) 513 8710