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Affordable Life Insurance: Know What Your Policy Doesn’t Cover?

Why invest in a life insurance policy? Well, one must get life insurance at affordable price to protect their family and fulfill the financial needs of those who depend on you. Investing in life insurance coverage will benefit your beneficiaries to get the payouts if you pass away. You will not only get one benefit. Different insurance policies offer distinct advantages, depending on the type of policy you want to purchase. While some life insurance policies also come with limits. Now, the question arises, how one can be assured of which coverage will offer benefits and which one comes with limitations. Well, the best way is to ask your agent for the details. If you are looking for other reliable help, refer to Insurtika– one of the best life insurance companies of 2021 to know what your policy doesn’t cover.  

To know what you policy may cover, click at Affordable Life Insurance Basic: Know What Your Policy Covers?

Other than the exceptions listed in the above-linked post, there are some cases/events where insurance companies don’t allow beneficiaries to claim death benefits or simply deny their claims. Which cases are not covered in insurance policies? Want to know what are they? Let’s find out!

What You Will Find In This Article?

  • Reasons Why Life Insurance Companies Deny Claim Benefits
  • Where Can Beneficiaries Use The Death Benefits Payouts

Let’s get started!

Reasons Why Life Insurance Companies Deny Claim Benefits        

Expired Policy  

It’s one of the most common reasons why most life insurance companies deny payments. Well, it also depends on the type of policy. For example, if one opts to purchase a term life insurance policy, then he/she needs to know that term coverage lasts for a specific time between 10 to 30 years. After this tenure, the policy will lapse, and claims made from a beneficiary end after this period will not process by the insurance companies. 

On the other hand, a whole life insurance policy lasts for a lifetime. But it may lapse if there’s a delay in premium payments even after the grace period is over. Therefore, one must be very careful with premiums. Otherwise, their family will not get any benefit at the time of need. There are many other reasons why life insurance companies deny claims. Some of them are listed below. Let’s have a look!     

Fraud and Misrepresentations

While planning to buy life insurance policy at an affordable price, one must ensure that all the given details are accurate as any fraud detail or misrepresentation may lead to grave consequences. You must know that the best life insurance policies come with a contestability period of two years, after which the policy goes into effect, whether its term or permanent life insurance. Therefore, if you die during this tenure, your details will be reviewed for misrepresentations, and if the insurance company found anything wrong, then your beneficiary might get nothing. 

Therefore, never hide about any pre-existing medical condition that may lead to death if you don’t want your family to face troubles. One needs to be clear with such details while asking for life insurance quotes from your agents.  

Therefore, never hide about any pre-existing medical condition that may lead to death if you don’t want your family to face troubles. One needs to be clear with such details while asking for life insurance quotes from your agents.  

In Case of Exclusions

Some policies may not cover death caused due to military events such as wars or drills. However, if a policyholder dies due to the act of terrorism, then the beneficiary may get death benefits if it’s in the clause. Some policies may not process claims for deaths due to policyholder’s participation in hazardous activities such as scuba diving. 

Therefore, one needs to make sure of these things before planning to purchase life insurance policy at an affordable price.   

Where Can Beneficiaries Can Use Death Benefits Payouts

Well, there are no limitations to it. Beneficiaries can use the death benefits payout as per their needs. Nevertheless, one must discuss with their family about what they expect from the policy because it can help you get accurate life insurance quotes, whether its term or whole life insurance quotes, which also include other types of expenses such as

Basic Living Expenses

Maintaining your family’s financial wellbeing in your absence is one of the main reasons why you must get life insurance policy at affordable price. However, if you are not the sole earner in your family and contribute only for living expenses such as house rent, monthly utilities, etc. Your beneficiary can use your death benefits payout for these expenses to maintain your family’s basic lifestyle. 

Mortgage Payments

It’s among the main monthly household expenses. Many people don’t think about mortgage expenses if they have already covered living expenses. But, it’s vital to understand that the needs for these two expenses are different. Let us help you understand this!

Let’s talk about living expenses such as groceries and compare them with mortgage payments. Your family will always need groceries. But, it might be possible that your mortgage payments may end after a few years. Therefore, one needs to invest in a good life insurance policy that covers mortgage debt separately.   

Debts

If you are having debts or planning to take a loan in the future, then you must keep this point into consideration before investing in any policy. If you die, your spouse will become solely responsible for your debt payments, which will become difficult for them in your absence. Therefore, you must ensure that your policy will cover your debts, whether it’s a credit card or business loan.  

Education expenses

You all aware of the fact that education costs are increasing day by day. Covering your child’s education expenses ensures that your child will get proper education even if you are not present with them suggests some of the largest life insurance companies of 2021

Conclusion:

A life insurance policy doesn’t only offer benefits to your beneficiaries if you die. It’s an investment that can help people with wealth building. Yes, you heard it right. Permanent life insurance policies allow the policyholder to have a cash value component that replaces tax-cuttings over time. One can only avail benefits if they know what their policy covers and whatnot. We hope that now you must be aware of it. However, if you are still in doubt, please feel free to get in touch with Insurtika– one of the Top 10 Life insurance companies in the USA.  

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