Coronavirus India: Existing Life Insurance Policies to Cover Death Caused by Coronavirus | G Plus News

Tuesday, 02 June 2020

daily news

Existing Life Insurance Policies to Cover Death Caused by Coronavirus

G Plus News | April 01, 2020 13:38 hrs

GUWAHATI: As the COVID-19 pandemic continues to spread its vicious tentacles with the number of deaths caused by the virus rising every passing day, in such a situation a pertinent question arises: Would the existing life and health insurance policies cover the death of a policyholder caused due to Coronavirus?

World Health Organisation (WHO) has declared the COVID-19 or coronavirus as pandemic. The virus has spread to all corners of the world infecting more than 10 lakh people and killing close to 24,000. 

In India, more than 1,000 people have tested positive for coronavirus and 20 people have died so far, according to the Ministry of Health & Family Welfare.

So, now the question arises: Will a life insurance policy cover the death of a policyholder due to coronavirus? Also, will you be able to get a life insurance policy after contracting the virus?

According to India’s largest insurer, Life Insurance Corporation of India (LIC), if the individual who passes away due to the coronavirus had a life insurance policy, the nominee of the policy will get the sum assured as the death benefit.

In fact, in Gujarat in two cases where the persons died due to cornoavirus infection, death benefit payments had been settled within twenty four hours, an LIC official claimed.

Death due to Coronavirus infection - which is a new health phenomenon - will be covered if you already have an existing life insurance policy.

In the rare event of one dying from a pandemic illness, the nominated beneficiary will receive the death benefit.

Notably, the Insurance Regulatory and Development Authority of India (IRDAI) has advised all health insurance companies to provide medical cover for Coronavirus (COVID-19) in order to avoid any hardship with immediate effect.  

"If coverage is granted for treatment and hospitalisation expenses, in order to alleviate hardships that may be caused to policyholders, all claims reported under coronavirus shall be handled," the circular issued by the insurance regulator noted.

According to the circular, if hospitalisation is covered under a policy, all coronavirus cases must be expeditiously handled. The costs of medical expenses will be settled in line with the terms and conditions of the policy contract.

Insurance experts said that if the deceased person had a life insurance policy, then the nominee of the beneficiary should be aware that death caused by health related issues are generally covered under a life insurance policy including term insurance. 

However, death benefits are not being given by private health insurance companies; they only cover the hospitalization charges.

“There is a difference between health and life insurance. Health insurance only covers hospital expenses. In any case, private insurers are better off as most of the expenses under the disease are covered by government health schemes,” an expert said.

Death benefit is the agreed amount of money (sum assured) payable by the insurer upon the death of the insured person to the nominee or the beneficiary.

But if you are planning on buying a life insurance policy at this point in time, then you should keep in mind that insurers determine the premiums of a policy on the basis of your health and medical history. Hence, it's reasonable to assume that a global health crisis like the coronavirus would have some impact on your policy acceptance and premiums, if you are currently in the application process stage.

Banner
Comments (0) Post Comment
Loading...