COVID + Credit: How Has COVID-19 Affected Your Insurance Needs?
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Your insurance needs aren’t static. As circumstances in your life change, the amount and kinds of insurance coverage you need may evolve as well. Most people understand the importance of maintaining their health insurance during the Coronavirus/Covid-19 pandemic, but what about other types of coverage?
How has the Covid-19 pandemic affected life insurance?
The number of life insurance applications rose significantly throughout 2020, according to the MIB Life Index, which tracks life insurance applications nationwide, and the year ended with the highest annual growth rate for life insurance policies on record. These numbers suggest that the pandemic has brought a worst-case scenario to mind for many Americans who now worry about leaving their families financially vulnerable in the face of sudden illness or death.
If you already have life insurance, you should know that most policies will pay out if you die as a result of Covid-19. If you don’t have life insurance, or if you have a low-coverage policy but are the primary breadwinner for your family, the pandemic might have caused you to rethink how you’ve planned to take care of your family in case you become ill or pass away. This could be a good time to review your assets and any income your family would receive in the event you become incapacitated or die from the disease.
Be aware, however, that most insurers are asking applicants who are currently sick with the virus to wait until they’ve recovered before applying for a new policy.
How has the pandemic affected auto insurance?
If you’re not driving as often these days, you might benefit from adjusting your auto insurance coverage. In fact, many insurers currently offer discounts and adjusted rates to drivers impacted by the Covid-19 pandemic. Discounts vary according to individual circumstances, so be sure to inquire about options available to you based on your coverage.
How has the pandemic affected homeowners insurance?
For new or existing primary residences, homeowners insurance hasn’t changed much during the pandemic.
Home buyers can still obtain coverage, and existing policyholders will generally not see much change in their coverage. Many insurers are also offering accommodations for policyholders experiencing hardships due to the Covid-19 pandemic. If you’re having trouble keeping up with your monthly payments, reach out to your insurer for possible assistance.
If you own properties in addition to your primary residence, such as a vacation home or rental property, and those properties are now sitting empty due to the pandemic, you should talk with your insurance agent about unoccupied property insurance.
Also known as vacant home insurance, this type of coverage protects an empty property in the event of disaster or vandalism the same way homeowners insurance protects an occupied home. The way this insurance operates hasn’t changed much since the start of the pandemic, but insurers are seeing a higher volume of new policies and claims being filed. You will need to consider a vacant home insurance policy if your primary residence has been empty for 30 days or longer.
Finally, if you’re one of the millions of Americans now working from home full-time due to the pandemic, you may also want to review whether this new setup requires changes to your homeowners insurance policy.
Many businesses have their own insurance policies that cover full-time employees working from home in the event of damage to important equipment such as laptops, printers and other company-owned technology. Outside of an employer’s coverage, most renters or homeowners insurance policies will cover about $2,500 worth of business equipment. Additional expenses or a more substantial work-from-home setup may warrant an update to your current homeowners insurance policy.
When should I review my insurance coverage and consider making changes?
Ultimately, there is no one-size-fits-all solution to insurance coverage, even during an event as universal as the Covid-19 pandemic. We’re living through a time of intense change. So, when in doubt, it’s a good idea to review your existing insurance coverage — be it homeowners, renters, auto, life, disability or another type of policy — and be sure it’s appropriate for your current living situation. You can contact your individual insurers for help reviewing your coverage and updating your policies as needed.