Several life and health insurers are scaling back their policies’ benefits due to the huge risks posed by the COVID-19 pandemic.
According to Naomi Ballantyne, founder of Partners Life, consumers should fully understand the content and coverage of their insurance, especially when renewing or switching policies. While terms of existing policies cannot be changed, getting new cover for issues related to COVID-19 is getting harder, she said.
“Things like redundancy, which are often optional benefits built into disability products, for example,” Ballantyne told Radio New Zealand. “Some companies – like ours – are applying a mental health exclusion for new customers, because the risk of stress and mental health claims is also unknowable and unquantifiable.”
Ballantyne added that some insurers have expressly indicated that they will not cover any COVID-19 related claims, because the risk is too high for them to handle. She also urged customers to consult an advisor.
While insurance for other health risks such as stroke, heart attack, and cancer are still available, Ballantyne said that it is probably “too late” for customers who want to get cover against COVID-19.
A number of companies, including Partners Life, are offering premium holidays of various lengths, to help out consumers that are struggling financially due to the global health crisis. Ballantyne advised consumers to avoid cancelling a policy despite financial difficulties, as it might be very hard to get a new policy with the pre-COVID-19 benefits in the future.
