Covid-19, vaccination and your insurance policies and benefits

By Finbar Garcia, LUTCF, FSS, MFA

Many of us would have taken a Covid-19 vaccine by now, be it willingly, after some hesitation or discussions with your doctor and family. So how does this impact your insurance policy or if you are thinking of taking out some insurance?

There are no exclusions or clause in the insurance policy that will deny any claims or even deny you from securing additional insurance coverage after being fully vaccinated, nor will it void your current policy.

So, what about persons who are not vaccinated? Our local insurance companies cannot discriminate nor be selective in choosing persons who are fully vaccinated over those who are not if someone wants coverage.

What these companies instituted, is a Covid-19 questionnaire in addition to their regular forms with all applications. This questionnaire will ask specific questions —if you were ever treated for Covid, quarantined, was ever a primary contact, even your travel history and proposed travel within the next six months. You must be honest with your answers as this can void any new coverage. It will be a guide to their underwriting process.

It’s in your best interest to take care of your health, more so during these uncertain times with the pandemic. Looking at the death rate of the pandemic in Trinidad and Tobago, if half of those persons had insurance, then some families would have some financial comfort.

How long the insurance money would last and how it would be invested is up to the beneficiaries. What about the other half?

Since this pandemic, insurance companies worldwide have adjusted their underwriting procedures to control any medical or negative effects from the virus before any policy can be issued.

In a recent chat with a friend of mine, her husband was infected with the virus. After many weeks at hospital, he recovered and was sent home. Later, he was diagnosed with kidney failure because of Covid-19. While his recovery is slowly progressing, even if he had comorbidities, the virus caused further complications.

These are some of the concerns that insurance companies are faced with; the uncertainty around Covid-19 and developing strains, and rising claims are making it difficult about on-boarding Covid-19 patients.

Although Covid-19 does not qualify as a chronic disease, the degree of scrutiny is greater for a recovered patient. Many Americans have sought medical care for post-Covid health problems that they had not been diagnosed with before becoming infected.

The most common health problems were pain, including in nerves and muscles; breathing difficulties; high cholesterol; malaise and fatigue; and high blood pressure.

So where does this leave you? Being fully vaccinated gives you the added protection of not dying from the virus.

Our local insurance companies also adjusted their underwriting guidelines to control the number of persons who are or were infected from the virus from securing any insurance for a specific period. This could be up to six months after being fully recovered.

Any unknown medical issues or side effects due to any pandemic, will create adjustments with insurance companies. It’s not that they don’t want to insure you or pay any claim, it’s to create the balance on their portfolio and not have any adverse effect on policy holders and increase cost from reinsurers.

Being diagnosed with Covid-19 and after recovery, there is no immediate information on the long-term medical effects; it may be too early to know for certain.

If there are signs and professional medical assessments that indicate medical issues in the future with lasting consequences, then insurance companies will incorporate that information into their underwriting standards which could affect the cost of coverage, including Life, Critical Illness and Health policies. This can be an overhaul of product pricing or possible policy ratings.

Insurers may even ask for additional medical tests in relation to the effects of Covid-19—lung function test; kidney function test; ECG, past medical reports from your doctor or the hospital that last treated you.

These tests could be at the client’s expense in addition to the possibility of being rated, even postponed, or declined.

Persons have questioned if this coronavirus pandemic makes it more important to have life insurance. This virus does not change the answer whether you need life insurance; it reinforces how important life insurance is when your loved ones depend on you financially.

Any opportunity you have to increase your life or critical illness insurance will be in your best interest and that of your family. Remember, “we buy insurance with our health, we pay for it with money”.

Increasing your life policy is just part of the issue. You also must increase your retirement fund/pension plan. If there are long-term medical consequences that could linger with you later in life, then this will certainly be in your retirement years. Where will the money come from to sustain these medical bills due to the Covid-19 effects?

In my view, Covid-19 is here to stay, just like the other pandemics in the past that created medical complications. This is the ‘new normal’. Adjustments will have to be made financially, but NEVER disregard your insurance policies and emergency funds.

We can eat less, party less and spend less…but always try and save more. Until we meet again…plant the seeds of investments.

“ All the flowers of all the tomorrows are planted in the seeds of today”….Unknown.

Call me for more information on planning your financial future. Send your questions to myfinancialadvisor2020@gmail.com or call 620-1185.