Life insurance is one of the most effective ways to ensure your family is protected. Should you suddenly become incapacitated or pass away, life insurance funds can be paid at once to the named beneficiaries without any concern about taxes or delays related to probate. However, when buying a life insurance policy, the one person who truly has your back is your agent.
Every life insurance company and individual policy varies in the terms of the policy, cost, and exclusions. However, the most common exclusions and provisions found in life insurance policies include:
Failure to disclose a known health condition. If you buy a life insurance policy and have a health condition that you don’t reveal, the life insurance company has the right to contest the payment of benefits.
Accidental death life insurance policies only cover accidental death, not death from natural causes, illnesses, or diseases. It is advised that you are covered for all eventualities, rather than only accidental death.
Exclusions for illegal or intentional acts. Many policies have an exclusion in which the death benefit will not be paid if you die while under the influence of drugs or alcohol, or while committing an illegal act of any type.
Death by suicide. This exclusion is generally written to state that if the person commits suicide within the first two years of owning the policy, and if occurs, will pay out only the amount paid in premiums, not the death benefit.
Dangerous activities. This exclusion can come into play in cases in which a person dies while engaged in a dangerous activity, such as mountain or rock climbing, racing, etc. If you are an extreme sports enthusiast, make sure you understand the fine print. You may be able to obtain coverage for these activities by paying a higher premium.
Aviation. This exclusion means that the insurance company will not pay if the insured person dies in a private plane accident, and only pays for death on a commercial flight.
War. Death from acts of war may be excluded in many policies.
Your Life Insurance Agent Can Help
When purchasing the right life insurance policy, get help from one of our friendly local agents at Carl L. Cramer Insurance LLC in Shippensburg, Pennsylvania. Your policy can be customized to meet your specific requirements and lifestyle choices.
We work closely with each of our clients, and always seek the best coverage at the lowest rates, as well as discuss the policy exclusions, so you know before you go.