In terms of personal financial planning, one of the consequences of coronavirus is a significant delay in securing critical illness, income protection, and life insurance policies. This is quite concerning as for many, now is a crucial time to have sufficient coverage. Insurance providers are doing their best to keep up with demand, but is it enough?
This does not constitute advice and advice should be sought in all instances before acting on it.
The importance of protection
For complete protection, all three types of policies are recommended. Critical Illness (CI), Income Protection (IP), and Life Insurance all offer different but essential benefits.
Both IP and CI cover will help you and your family survive financially in the event of illness or injury, but they offer slightly different benefits.
Income protection is tied to your income and will pay out a portion of your gross income while you’re off work. You can submit multiple claims and more illnesses are covered.
Critical Illness cover pays out in one lump sum, you can only submit one claim during your term, and the conditions covered are more selective.
Despite their differences, both play a vital role in your protection portfolio.
When the worst happens, Life cover is there to ensure your family is taken care of. The pay out is in one lump sum, but is designed to help your loved ones weather the worst of the storm. The money can be put towards the mortgage or anything that needs to covered by the missing income.
Tough times for the medical community
Arguably, healthcare workers like doctors, nurses, medics, and anyone else on the front line fighting the Covid-19 pandemic are the most in need of protection policies. At first, insurers were making it difficult for those in the medical community to get coverage. Their applications were being delayed and subject to extra scrutiny.
Insurance providers added questions to their applications related to the coronavirus — asking if you were experiencing symptoms, had been in contact with someone suspected/confirmed to have the virus, were self-isolating for any reason, or tested positive. These could all affect your chances of a successful application. More likely than not, a healthcare worker’s case would be postponed.
Thankfully, the tides are turning
Sine the dramatic changes, insurers have since softened and started offering exceptions for front line workers. However, it hasn’t exactly made the process of securing a new policy or upgrading coverage any easier.
Insurance providers are still taking into account whether an applicant is in contact with COVID-19 at work and higher volumes of applications is putting pressure on decision timescales. Providers are overwhelmed and their resources are over-extended.
On a positive side, many providers have embraced technology and have begun offering virtual screenings in lieu of being able to obtain medical evidence. However, with many cases needing special attention from the underwriting teams, delays should still be expected.
We’re here to talk (around your schedule)
Right now, with healthcare workers working around the clock, we know it might be difficult to find time to talk. This is why we’re happy to schedule a consultation around your schedule — nights, weekends — whenever works for you. Don’t hesitate to contact us whenever you’re in need of financial help – we’re here to support you.
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Dental & Medical Financial Services have been helping doctors and dentists to build and protect their wealth, whilst saving tax for over 25 years.