Coronavirus and Life Insurance
As uncertainty looms large in times of the pandemic, life insurance makes even more sense than usual. But are life insurance companies accepting applications?
There is always something or other happening in our lives. Right now, we have the coronavirus. In 2014 it was Ebola, in 2009-10 the swine flu, and before that it was SARS. The point is there always seem to be strange and new viruses showing up in our lives.
Many people have been wondering what will happen if they can’t contain Covid-19 in the next year? Could life insurance companies stop taking new applications for a while? Well, it is always a possibility depending upon the claims experience of various insurance companies. Some companies have already stopped accepting applications from people who have been traveling to the highly affected areas. But there is no way for us to know how they will respond in the future.
But if that concerns you, why not get a policy now while you can?
When is the best time to buy a life insurance policy?
The best time to buy a life insurance policy is when you are healthy! That is when you can qualify for the lowest possible rates and the best possible ratings. For most people, it is also when we are younger. Because the chances of diabetes, high blood pressure, and other ailments can become more likely as we age.
Even if you have some chronic ailments mentioned above, you may still be able to get a policy. You may not qualify for the lowest rates, but it’s better than not having a policy at all.
The good news is that many life insurance companies are even offering policies right now without a physical exam for people who are in good health. Today’s technology also makes it very easy for you to find lowest rates with reputable companies.
Consider a two-policy approach to life insurance
While you are looking at life insurance policies, also consider a two-policy approach. Get a larger low-cost term policy for which you can lock in the rates for 20 or 30 years, but also consider getting another smaller permanent policy which can include some long-term care benefits or chronic illness riders.
It has been my experience that very few people in the Indian community have done any long-term care planning and if you choose to include your life insurance in your planning, you can sit back and relax.
Permanent life policies like indexed universal life, whole life or variable life offer variety of benefits including the ability to grow your money on a tax deferred basis, a death benefit that is income tax free, as well as the ability to borrow your cash values also without any taxation. Many people also use these policies to build a tax preferred retirement plan.
I have never been a fearmonger, but if something like the Coronavirus has given you the wakeup call to take action and get a policy—something you probably should have had done a long time ago—then so be it. There are plenty of qualified agents out there to help you.
Moneywise is hosted by Rajesh Jyotishi with Shalin Financial Services, Inc.
Rajesh Jyotishi is a registered representative of Dempsey Lord Smith, LLC, which is a registered broker-dealer and a member of FINRA/SIPC. Advisory Services are offered through Dempsey Lord Smith, LLC.
Rajesh has been a resident of Atlanta since 1975 and in the financial services industry since 1991. For questions, he can be reached at 770-884-8175 or at RJ@shalinfinancial.com.
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