December 5, 2020
Most of us don’t think about our death. Especially for those of us who are young, it seems very far away and not deserving of our attention right now.
The COVID-19 pandemic changed that for a lot of people. The idea of a strange virus running rampant around the world and watching the death tolls rise on the news has brought many people face to face with their own mortality.
Many, particularly the family’s breadwinners, then wonder, “what will happen to my family if I die?” This has prompted many people to think about buying life insurance to ensure their families are taken care of financially in the event of their death.
But running around to insurance companies and doctors’ offices for medical exams doesn’t seem very safe right now. Hence why buying term life insurance online makes sense. Let’s explore further.
There are two basic types of life insurance. Term life and permanent life insurance, which covers you until you die. There are various subtypes of permanent life insurance including whole life and universal life, offering different benefits and investment opportunities.
Term life only covers you for a certain period of time, for example 10 or 20 years, called a “term”. It’s a simple form of insurance that doesn’t have any built-in investment options or cash values that add complexity and increases the monthly premium.
Instead, you just pay your premiums for your chosen period of time and if you die during that time, your beneficiaries get a payout. Sweet and simple.
Because term life is so simple (and relatively few people die during their term) it is very inexpensive. If you are young and healthy, it’s even cheaper. This is what makes term life an attractive option for young families. It’s a very inexpensive way to ensure your family will be taken care of financially without you.
Many people know that they should buy life insurance and plan to get around to it eventually. However, few people enthusiastically rush to the nearest insurance company to buy their policy. The pandemic, however, has once again brought life insurance to the forefront of many people’s minds.
Life insurance is typically sold in person, only about a third of the people looking into life insurance will try to buy it online. Buying life insurance is not a natural thing. Death, particularly for the young, seems distant — until something like the coronavirus forces them to contemplate it. Also, the person buying doesn’t benefit from life insurance — their family does. And while that peace of mind is nice for the insured, most people are more motivated to do things that directly benefit them.
All this makes selling life insurance online very tough. But right now, it’s the best way to buy life insurance. Here’s why.
Stay at home, social distance, wear a mask — all these things are prompting people to avoid any unnecessary contact with people outside their “bubble”. What if you went to buy life insurance, catch COVID during your trip and ironically die because you were trying to provide for your family?
We’re being a bit facetious here of course, but in these times it’s important to place safety first. Especially when you can simply open up your laptop and purchase life insurance from the comfort of your own home.
In response to concerns about the coronavirus and the desire to maintain social distancing, certain insurance companies have relaxed their requirements. Young, healthy people generally won’t be required to take a medical exam or offer a blood or urine sample for testing.
It’s a great time for those who have a fear of needles to apply for life insurance.
While many people buy life insurance because an in-person agent is there encouraging them to buy it, others are turned off by a salesperson trying to convince them to buy. If this is you, buying life insurance online is the perfect solution.
You can take your time to read through the available options and determine which is right for you without an eager agent helping you through the process.
What if you have questions? It’s simple! You can contact the company or chat with an agent to ask for advice and it’s all super low pressure.
What if after buying your policy, you decide it isn’t right for you after all. This is part of what scares people about buying life insurance. They may be signing up for a policy they don’t fully understand and are agreeing to pay premiums for decades.
To ease this concern, insurance companies are required to grant policyholders the right of rescission, also called a free look period. This is basically a test-drive for your insurance policy. If you decide you want to back out within the period, there are no penalties and you get back any premiums that you paid.
Companies can set their free look periods at longer lengths of time, but the minimum in Canada is 10 days. In the U.S., it varies by state but ranges between 10 and 20 days. This is actually not new and not a change to traditional policies in response to coronavirus – but it is something consumers are often not aware of and even more relevant now.
Now the question is... can you buy COVID-19 life insurance? Yep. Mortality rates from COVID aren’t high enough to affect life insurance or even bump the premiums up and unless things take a sharp turn for the worse, it doesn’t look like that will happen. Not to mention nobody wants to be the first company to announce they won’t cover coronavirus deaths as a part of their life insurance.
Are you ready to take the plunge and buy life insurance? Within age limits, healthy folks won’t require medical exam, and term life insurance rates are extremely affordable. If you can afford a fancy coffee once a week, you can afford term life insurance.