Have life and disability insurance rates increased due to Covid-19?
Nov 14, 2020 | 07:45 am
In this week’s GME presentation to Hopkins residents a question was raised: Have life and disability insurance rates increased due to Covid-19?
An April 2020 article on kevinmd.com indicates that (at least at time of original posting) pricing for disability insurance hadn’t changed, and that residents can and should still qualify for good deals.
A more recent August 9 2020 Forbes article on life insurance rates observes that some insurance companies have started raising prices and/or begun to require more applicants to submit to detailed medical exams. This is a reversal of a trend in which fewer applicants have needed to submit to medical exams. One industry professional suggests that life insurance pricing may increase by 5 to 10% in the coming year.
Furthermore, international travel, one’s own infection with Covid-19, or having been in close proximity to someone who is infected could lead to postponement of one’s application. Insurers want some time to see how a condition is resolved or to ensure that an applicant doesn’t have or will not contract the disease in the near future.
Both articles appear to encourage people to get disability and life insurance, respectively. Such recommendations must be taken with a grain of salt when made by insurance industry professionals who benefit from a higher volume of sales. Nevertheless, it is reasonable to forecast that a new pandemic that increases disability or mortality for an extended period of time will manifest in higher insurance rates.