Coronavirus: What you need to know about life insurance
You can still take out life insurance during the coronavirus pandemic, as long as you've followed government travel advice.
We’re reader-supported and may be paid when you visit links to partner sites. We don’t compare all products in the market, but we’re working on it!
The coronavirus (COVID-19) pandemic has had a huge impact on many aspects of our lives but some are more obvious than others. One area which is easily overlooked - despite being very important - is the impact COVID-19 could have on life insurance.
Here, we address some of the big questions around COVID-19 and how it's impacting life insurance, so you've got a better understanding of what's going on.
Does your life insurance cover COVID-19?
If you have life insurance, and you're one of the very unfortunate people who die as a result of COVID-19, your life insurance policy should pay out.
The Financial Services Council (FSC) confirmed this in March, when it released a statement as soon after the coronavirus outbreak was recognised as a global pandemic.
"There are no exclusions in existing life insurance policies that would prevent the policy paying out for a death claim related to coronavirus, if you follow government travel advice," said the FSC.
"No-one should be concerned about their existing life cover and you can ask your life insurer or superannuation trustee what you are covered for."
How does government travel advice impact life insurance?
The FSC has assured people with life insurance that their policies will pay out if they die due to COVID-19, as long as they followed government travel advice. But what does that mean?
Well, on March 18, for the first time in Australia's history, the government issued the highest level of travel alert, urging all citizens not to travel to any other country. Unfortunately, for people with loved ones overseas, international travel might still be a very real prospect.
However, if you do head overseas against government advice - for whatever reason - it's very likely your life insurance policy would no longer be valid. This is because, in the eyes of insurance companies, you're intentionally putting yourself in harm's way.
Unfortunately, this extends to income protection policies as well as total and permanent disability (TPD) policies. If you are planning on travelling overseas, contact your insurer immediately so you can find out how your coverage might be impacted in the present, and when you come back.
What if you got your life insurance after COVID-19 became a known event?
Usually, it doesn't matter. You'll still be covered, even if you bought your life insurance policy after COVID-19 became public knowledge. However, there is an exception to the rule.
If you're a healthcare workers and you took out new cover between 11 March 2020 and 6 April 2020, you should check with your life insurance company or superannuation provider about any exclusions that may apply.
This is because some insurance brands may have exclusions during that time but, from 6 April, insurers were allowed to collaborate to ensure front-line healthcare workers didn't face exclusions.
This system is different to travel insurance, where insurers typically won't pay out for claims associated with the coronavirus if you bought your policy after COVID-19 became a known event.
Can you still get life insurance to cover COVID-19?
Yes. You can still get life insurance which would cover you in the event you died from COVID-19. However, you'll probably have to let the insurance company know if you've been overseas recently, or if you've been in close contact with anyone diagnosed with COVID-19.
A statement released by life insurer NobleOak on 16 March confirmed the company is still offering coverage, but said each case would be assessed individually by its underwriting team.
"Our underwriting process requires clients to provide details of any past illness, during the application process," it said. "If they have COVID-19 like symptoms, their assessment may be deferred until they have been assessed and fully recovered."
Can I still get life insurance if I'm a healthcare worker?
Yes. You can still get life insurance if you're a healthcare worker, and you won't have to pay any more for cover just because you're at higher risk of contracting COVID-19.
This is because the ACCC granted "interim authorisation" to let life insurers coordinate, so frontline healthcare workers aren't excluded from coverage.
This means exposure to COVID-19 can't be used as a reason to decline life insurance coverage, charge higher premiums, or apply risk exclusions, to frontline health workers.
The rule applies to workers including - but not limited to - doctors, nurses, hospital workers, ambulance workers, paramedics, people working at GP surgeries or clinics, people working on COVD-19 vaccines, pharmacists, police, aged care workers and volunteers supporting people with COVID-19.
ACCC Chair Rod Sims said the announcement was in the public's interest but said anyone looking for life insurance should still do their homework before committing to a policy.
"I strongly encourage everyone looking to purchase life insurance to first check the cover they may have under existing policies and through their superannuation fund," he said. "The authorisation does not include coordination on pricing, meaning customers should still shop around."
Will coronavirus impact life insurance in the future?
There's no way of knowing the long-term impact coronavirus will have on Australia's insurance market. However, we do know that the SARS epidemic of 2003 hit insurance companies hard.
If you're thinking about buying life insurance, there's no harm in doing it now. It won't cost you more due to the coronavirus, but you will get cover if the worst happens.
Plus, there's a possibility that insurers will tighten underwriting criteria in the future, or even implement waiting periods for COVID-19.
Compare life insurance policies
More COVID-19 guides
If you feel like your claim was unfairly rejected, you might be right. Here's how it could pay off if you dig your heels in.Read more…
Aussies might be able to claim refunds for unused travel insurance, following a recent ACCC statement.Read more…
Your landlord insurance can only help in certain circumstances. Here's where.Read more…
Got an overseas trip booked? Read this.Read more…
Learn how income protection can help – whether you’ve already got coverage or you’re thinking about buying it.Read more…
See what you can and can't get insurance for with Covid-19. This updated guide looks at travel, life, business and health.Read more…
We analysed 31 travel insurance policies to see what's really covered.Read more…
Unless you bought travel insurance before January, you won't be covered for the coronavirus. But there may be other ways you can protect your pocket.Read more…
Here's how travel insurers are responding to the pandemic.Read more…
Other quick ways to save money
Are you worried about your finances during this time? Don't forget to review your bills - spending a little time on admin, could save you over the weeks and months to come.
Here are some guides on how to save some money on your daily expenses. There are plenty of things you could do, from checking your energy rates, switching to a low-interest credit card, or simply dropping parts of your insurance that you don't need.
More guides on Finder
Amazon Prime Day Australia 2021: All the best deals from Day 2
Here are all the best deals from Amazon Prime Day Australia's second day - including the return of dirt-cheap Nintendo Switch consoles.
Prime Day deal: $100 off Sony’s ‘Bose Killing’ Headphones
Get 33% off Sony WH1000XM3 Wireless Noise Cancelling Headphones during Amazon Prime Day 2021. Here's how to get the deal before it disappears.
How to get $120 off Nintendo Switch on Amazon Prime Day
Amazon Australia is selling the Nintendo Switch video game console for $349 during Prime Day - that's over $120 off the RRP.
Amazon Prime Day’s best deals on big-ticket items: Up to 46% off
From Segways to stand-up paddleboards, these are the best Prime Day savings on the most expensive items.
Nacon RIG 500 Pro HC Gen 2 review: Super comfortable gaming headphones
The Nacon Rig 500 Pro HC headphones have wide console and PC compatibility, Dolby Atmos licensing and a genuinely comfortable design, even for longer gaming sessions.
Oppo Find X3 Neo 5G review: Oppo’s better flagship phone
The Oppo Find X3 Neo lacks the utter flagship features of the Find X3 Pro, but you won't miss them, while you will enjoy its lower price point.
7 health insurance deals to save you money at tax time
Avoid the MLS tax and get a rebate by taking out health insurance. Here are 7 deals that’ll save you money on your tax returns.
Today’s ASX top stocks: Milton Corporation (MLT ↑16.0%), Oneview Healthcare (ONE ↑12.8%)
The 10 biggest movers on the ASX for Tuesday 22 June 2021.
Mobile plans are now more expensive, but here’s a hack to save $200 a year
Telstra, Optus and Vodafone keep raising their prices even as the rest of the market is more affordable than ever.
Ask an Expert