Find out what to look out for in your life cover contract to ensure that your family get the pay-out they need if something happens to you.
Important terms and conditions detailed in the fine print of your life insurance contract may affect your family’s claim in the event of your death. So what do you need to look out for in your contract to ensure that your family get the life cover pay-out they need?
Find out what you need to do to keep the policy up-to-date and what life changes you need to inform the insurer about. This would probably include lifestyle changes, such as starting to smoke, an increase in alcohol consumption or commencing high-risk activities such as sky-diving, as well as changes to address and personal details.
Make sure you understand when and how premiums will increase, so that there are no surprises in future and your policy is budgeted and paid for every month.
Make sure you are aware of how much time your family has in which to submit a claim after your death. Inform your family of these time limits when you explain the policy to them, giving them the contact details of your provider and your policy number.
Check for any exclusions and waiting periods on the policy. For example, your policy might not pay, for instance, if you die:
- While participating in a hazardous sport
- As a result of a pre-existing medical condition
- As a result of suicide
- While committing a crime
- Natural death, if your policy covers only accidental death
Your policy will be suspended or terminated if you fail to pay your premium. Check the policy as to when payment is due, and preferably set up a debit order so that payment is not dependent on your memory.
Check that the beneficiaries’ names are spelled correctly, and their contact details correct. It’s very important to review your beneficiaries every few years and inform your insurer of any changes.
Understanding the contract and all the conditions of your insurance policy will ensure that claims are settled without delay.