The Coronavirus Otherwise Know as COVID-19 is Now A Global Pandemic and the Big Question is, How Bad Will it Get?
Like the world does not have enough problems to think about already. Now we have the Coronavirus COVID-19 to deal with. According to the alarmist news teams, they state the virus is spreading. At this time there is no vaccine to prevent it which makes the situation worse. It is only human nature to worry about this escalating into an even more major event. Hopefully a vaccine will be created in the near future and start putting and end to this invading medical condition. When this will happen? We just don’t know so all we can do is deal with it as best as we can. The one thing we do know is Coronavirus and life insurance rates will definitely not play nicely together.
Pandemic vs. epidemic, what is the difference?
- Pandemic – Most people have never heard of the word pandemic. A pandemic is newly introduced type of disease that is spread globally all over the world. A pandemic is usually also a new disease that there is very limited information known about it. This makes it a more intense problem because the medical field does not no how to class it or even treat it. They don’t even know what the short term or long term affects will have.
- Epidemic – An epidemic is usually a disease that is limited to one specific area on the map. It is much easier to treat an epidemic because you don’t have near the people traveling back and forth to different countries passing along the condition. In many cases different strains of the virus can be found depending on the country infected with it.
Pandemics such as Coronavirus (COVID-19) and life insurance companies
The word pandemic is a four letter word for the life insurance industry. The carriers have to move slowly and get as much information as possible to rule out that an applicant is not positive for Coronavirus. This is especially true if the applicant has been active in foreign travel in the last few months. There is no such thing as a pandemic exclusion for life insurance like there could be for dangerous sports or acts or war. If you have been involved in international travel especially spending time in China. If you do apply, you application could be postponed or an increase in premium could even be applied.
How will applying for life insurance be affected by the Coronavirus?
It is too early to predict exactly what will happen deep within the life insurance industry but it does not look very positive. The top life insurance carries in the United States has been struggling with COVID-19 as it continues to spread all through the country. The life insurance companies realize that they will face many policy losses as the number of Coronavirus related deaths continue to grow.
They also have been facing the major threat stemming from collapsing bond rates. They have had ringside seats watching their bond rate reach historic lows just this week alone. This spells financial losses to the life insurance industry just like many other economic playing fields. The rapidly declining stock market is a is a direct indication of this.
Due to Coronavirus, life insurers will have to start raising rates
This is actually nothing new because life insurance rates can very easily fluctuate from month to month to some degree. If the bond rates and other financial investments continue to plummet. The life insurance industry will have to start charging more for their products to continue generating a profit and staying afloat. This is nothing new because whenever we have any financial recession periods. The rates will have to go up due to the poor investment returns. This has happened many times in the past and we will see this many times in the future too. Keep in mind that the life insurers have to have ample cash on hand to pay the millions of dollars in death claims each year.
The life insurance companies will have to start testing for the Coronavirus when processing the many applications that they have to underwrite each month. To the world, COVID-19 is a global pandemic and to the insurance industry it is a mystery medical condition that they do not fully understand. The big question is, what to do when an application is submitted with a positive answer of Covid-19. If they knew what the virus was all about they could underwrite properly for it. But as it is, they are shooting in the dark so to speak.
Consumers will procrastinate concerning life insurance & Coronavirus
Most consumers that know they need to apply for life insurance constantly procrastinate and put it off to another time. They can come up with a countless number of excuses why they will apply next week or next month. When they do this, they are taking a gamble that the rates may increase. Then their future premiums will now be higher than before once they do apply.
Every year an individual gets older, their quoting rates go up a notch. Some life insurance companies use an “insurance age” to classify a persons age. This actually means what age are they closer to, their current age or their next birthday age.
Here is what we recommend concerning Coronavirus and life insurance applications
If you have any interest in applying for life insurance, apply as soon as possible. At this point in time you will probably find the conventional application process to be the same. If you wait, it is very logical to believe we could be seeing rate increases along with more complicated underwriting. The rate increases are sure to come as long as the stock market and investments are taking a hit. The life insurance companies will be forced to increase their rates to compensate for higher operating expenses. Between the higher operating costs and the reduction of profits from investments, it would take a miracle for the new rates for future policies not to increase.
Using the correct company for Coronavirus
Always remember the simple fact that life insurance companies underwrite and process their applications differently. Using the most applicable company can make all the difference when searching for the best rates. The health classifications is the biggest factor when determining how much your premium will be. All experienced insurance agents will know from experience what company would be your best choice.
Connect with an independent insurance agent
If you place any value on your time which I can only assume you do. The smartest step to take is to seek the assistance from an experienced independent insurance agent. Your agent can do all the work for you and make sure you get the best rates with no charge and without any obligation. Independent agents otherwise known as brokers can review all the companies on the market unlike captive agents such as State Farm which has just one. Their job is to do all the leg work for you.
Make sure to use our quote comparison tool
Use our websites quote comparison tool will help you get your feet wet. You can see what kind of premiums you can expect for the various plan designs and death benefits. You can compare over 40 different companies side-by-side to see for yourself who has the best rates. Just complete the form on the right and you will be comparing rates in less than a minute.
Purchasing life insurance during the Coronavirus COVID-19 pandemic can sound like a complicated process. At this point in time business is as usual. What the future holds in store is something we will find out later in the game. We have over 25 years experience helping people find the best life insurance policy at the lowest possible rates. Call us today and we will be happy to answer your questions and get you pointed in the right direction.
All the best,