Life Insurance Expiry – When Managing Premiums Is Difficult

By Author: cispratik
Total Articles: 42
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Often with a life insurance policy, the cover will last for only as long as you pay the premium – and once your payments stop, so will the cover. However many New Zealand life insurance companies will actually offer a three month grace period (so missing one month’s premiums will not place the cover in jeopardy). In this case, one missed premium is not a problem, but once three months’ premiums have been missed, the cover will cease, and there would no longer be a life insurance sum payable on death. In some cases the cover can be reinstated, however in other cases, you would need to reapply for a new life insurance plan. 

So the first three months are usually OK – however periods longer than this can cause problems.  In many cases missed premiums are due to some form of financial hardship – for example job loss or even natural disaster. If the inability to pay premiums is caused by something like this, it is worth checking with the insurer to see if they have any options in place to help you. 

A common example is job loss. In the case of job loss, many New Zealand life insurance companies will actually ...
... offer to suspend your premiums for a period of time longer than three months. In this case you are not covered during the suspension period, but can reinstate your life insurance cover without needing to provide more health information (so even if your health had gotten worse during the suspension period, you could still restart your insurance with no problems). 

In the case of natural disaster, some New Zealand life insurers are even more flexible, In some cases they will suspend premiums for a period of time while allowing you to remain covered. 

For this reason, if you are thinking about setting up a Health insurance quotes, it is worth checking how your insurer approaches cases where premiums are missed. Do they suspend cover immediately, or are they more flexible, offering options like those outlined above? Confirming this will help you make sure you have a life insurance policy that you can rely on even when times are tough.

Find useful information on http://www.inform.co.nz/health-insurance/ and you can also know about http://www.inform.co.nz/life-insurance/ or E-mail at info@lifedirect.co.nz