Taking out life insurance can be one of the most important decisions to guarantee your family’s financial peace of mind in case of unforeseen events. However, many people do not know exactly what life insurance covers and what its main benefits are.
In this article, we explain in detail the most common coverages. In addition, we will tell you which deaths are covered by a life insurance policy and which illnesses, as well as which other guarantees are not covered.
What does life insurance cover?
A life insurance policy is a contract between the policyholder and the insurer, in which the latter guarantees the payment of an insured capital sum to the designated beneficiaries in the event of the occurrence of any of the events included in the insurance coverage on the insured person.
But what are these events? What does life insurance normally cover? Let’s take a look:
Death of the insured
This is the primary coverage of any life insurance policy. In the event of death, whether from natural causes, illness or accident, beneficiaries receive an indemnity to help them meet expenses such as debts, mortgages or maintaining their standard of living.
What type of death is covered by life insurance? In general, a life insurance policy covers both natural death and death caused by a traffic accident or any other type of accident. Some insurance policies even offer a double or triple capital sum in the event of death due to an accident or traffic accident.
Absolute or total permanent disability
If the insured suffers a disability that prevents him/her from performing any professional activity, the insurance may include an indemnity. Depending on the policy, this disability covered may be:
- Absolute permanent disability. The insured is unable to perform any work activity.
- Total permanent disability. Disability limits the insured to exercise certain professions. This is the option we recommend in our article on life insurance and disability, since it is recognized by Social Security on many more occasions.
Serious diseases
And what about illnesses? Indeed, in addition to covering death or disability, there are also illnesses covered by life insurance, such as cancer, heart attack or kidney failure. Although it depends on each policy, some issues are covered or others, and it is an unusual coverage to subscribe to, but no less recommendable for that reason.
In these cases, the insured receives an advance of the capital, which may be additional or deducted from the total, according to the conditions of the contract. This coverage is especially useful to meet expenses arising from medical treatment.
What is not covered by life insurance?
As you can see, there are many situations covered by life insurance; although, obviously, there are also certain exclusions.
Among the most common cases not covered by life insurance are:
- Suicide. In most policies, it is not covered if it occurs in the first year of the contract.
- Death due to hazardous activities. Death due to activities such as extreme sports may be excluded unless expressly stated in the insurance policy.
- Death resulting from unlawful acts. If the insured dies while committing a crime, the insurer will also not indemnify the beneficiaries.
Up to what age does a life insurance policy cover?
Another very common question is up to what age a life insurance policy covers. Because yes: unfortunately, life insurance coverage is limited by the age of the insured.
Generally, policies cover up to age 65 or 70 for disability; while for death they may extend beyond that (up to age 80), depending on the insurer and the type of insurance you take out.
For reasons like this, it is essential to choose your life insurance policy wisely and to do so with the help of an expert. As an insurance comparator, at Moné we can help you understand the limits of each policy and find one that fits your needs.
Additional coverages that can make a difference
In addition, at Moné we have first-hand knowledge of the best life insurance policies on the market.
What are they? Well, normally, they are policies that, in addition to the basic coverages, offer additional options that can be very useful to you.
For example:
- Double and triple capital per accident. If the death of the insured occurs due to an accident or traffic accident, the beneficiaries may receive up to three times the insured capital in some policies.
- Coverage for specific illnesses. It includes a list of serious illnesses and provides you with financial support for their treatment.
- Partial disability coverage. Although not absolute, some policies offer indemnity for partial disability. This is common in accident insurance.
How to choose the best life insurance?
If you are going to take out a life insurance policy and you are concerned about its coverage, remember that the first thing you have to do is to analyze your needs and those of your family. You should take into account factors such as the sum insured, the flexibility of the policy and the strength of your insurer, among many others.
Don’t forget that, at PIB Group Iberia, our team of experts is at your disposal if you need it. We know how important it is to ensure your family’s financial security. That is why we are committed to finding the right life insurance in Zaragoza that’s right for you.
Don’t wait any longer to protect your future and that of your loved ones, contact us!
