Term insurances come with affordable premium rates and provide financial protection to the family of the insured, in case of any eventuality. A lump sum death benefit is paid to the beneficiary, in case of demise of the insured during the policy tenure. Even though they are the best insurance option one can have, it is better to have knowledge about the kind of deaths that are covered or not covered by the term plan in India . It is always better to be aware of the terms and conditions of the insurance policy so that there will not be an unpleasant surprise to your family members or dependents upon your death. Let’s see what kind of deaths are not covered in term insurance.
- Death due to driving under the influence of alcohol won’t be covered
- Accidental death due to driving under the influence of drugs.
- Death due to the participation in racing events.
- Death due to the participation in adventure sports.
- Death due to pregnancy and childbirth.
- Death due to the pre-existing health condition.
- Death caused due to the participation in illegal activities.
There are certain exclusions under the lifestyle category. If you happen to smoke, it needs to be mentioned in the policy. Following which the insurance company will charge additional premium to assess the risk of death due to smoking. In case of chainsmokers, this will pose a great risk to insurance companies. If you try to conceal the information about your smoking habits, the company may reject the insurance claim. Also if you abuse your body in any other way meaning self-destruction, the policy claim may be rejected by the insurance company.
Apart from the above mentioned pointers, let’s take a look into what kind of deaths are not covered in term insurance.
- Self-inflicted injury: If the cause of death is due to self-inflicted injury or any hazardous adventurous activity, the claim will be rejected by the insurance company.
- HIV/AIDS: The insurance claim will not be admissible by the insurance company if the death takes place due to sexually transmitted diseases like HIV or AIDS.
- Intoxication: If the death takes place due to the consumption of alcohol or any form of drugs, the insurance company has the right to reject the claim.
- Homicide: If the policyholder dies due to the murder committed by the nominee, the insurance company will reject the claim. If the investigation takes place, the insurance company will put the claim on hold until the acquittal of the nominee.
- Natural disasters: The deaths that take place due to any natural disaster will not be covered by the life insurance company unless the policyholder goes for additional rider.
If there is a change in lifestyle after the subscription of the life insurance policy, the policyholder is not liable to share the information. On the other hand, if you are addicted to smoking after buying the policy, the insurance coverage applies and the insurance company should process the claim without any issues. If there are any issues in claiming the policy, you can approach the grievances cell of the insurance company or Insurance Regulatory and Development Authority directly.
Any natural death or health-related issues will be covered by term insurance plans. In case the policyholder dies due to any type of critical illness or medical condition, the beneficiary of the policy will get the sum assured as the death benefit. Term plans also provide coverage in case of death of the insured due to an accident. Moreover, many term life plans come with an additional accidental death benefit riders under which extra sum assured is paid to the beneficiary of the policy along with the basic sum assured, in case of accidental demise of the insured person. In case the insured commits suicide during the initial 12 months from the date of policy commencement, the beneficiary is eligible to receive 80% of the premium paid if the policy is a non-linked one. In case of linked plans, if the policyholder commits suicide during the initial 12 months from the date of policy commencement, the beneficiary of the policy receives 100% of the total premium paid. However, if the policyholder commits suicide after the completion of 1 year of policy, the benefits of the policy will be nullified and the policy will be terminated. There are certain life insurance companies that may or may not provide coverage for the suicidal death.
Future Generali Flexi Online Term Plan provides this option of income protection for those who want to secure their family’s future in the long run. A free look-in period and a grace period of upto 30 days to pay your premiums are some of the benefits that you get along with it.