Types Of Deaths Not Covered By Life Insurance
Life insurance is a must today because it provides much-needed compensation when an earning family member is no longer able to provide financially due to severe disability or has passed away.
It enables the policy holder’s loved ones to get on with the rest of their lives, enabling them to carry out various financial obligations thus coping with the difficult circumstances that they have to now face for the rest of their lives.
Situations Under Which A Claim Cannot Be Made On Life Insurance Policy
Before signing up for a life insurance policy, it is vital for the policy holder to know about inclusions and exclusions to policy clam as only then there will be no confusion at the time of making a claim.
When a policy holder passes away, a claim can be made by loved ones on his or her life insurance policy and payout is made by the insurance company based on the cause of death. However, there are certain causes of death that cannot be used to make a policy claim. In case the policy holder passes away due to drug influence or alcohol consumption, the insurance company will reject claim.
This will also happen if passing away is caused by smoking habit which was not declared at the time of policy sign up. If the policyholder is someone who likes to indulge in adventure sports, like car racing, paragliding, skydiving, hiking, once again no payout can be gained.
Which type of death is covered in term insurance?
When the policy holder has a transmitted disease like HIV/Aids no compensation can be availed. In case the policy holder is affected by critical illness, a claim cannot be made on the policy for expenses airing from treatment and separate policy has to be purchased for this purpose.
In the event of policy holder passing away due to hazardous activities such as mixing chemicals, experimenting with dangerous substances else has inflicted injuries on him or herself or taken an overdose of medical drugs, claim cannot be made on the policy.
When the policy holder passes away due to natural calamity such as floods, earthquake etc, payout cannot be obtained. Situations like suicide is not covered by life insurance and hence no compensation is given to the surviving relatives.
What is not covered in my life policy?
In case the policy holder was pregnant and death was caused due to complications related to this condition, once again policy will not payout. In case death of policy holder is due to involvement in criminal activity, payment once again will not be made.
In the event of the policy holder passing away, leaving behind mortgage payments, life insurance policy cannot be sued to make the mortgage payment. It is to be noted that life insurance is meant to give protection to your loved ones, in the event of an unexpected situation wherein they face difficult circumstances.
Coverage from the policy offers ample assistance in coping with the financial losses arising from this problem. However it is to be noted that there are certain circumstances in which the policy will not pay and knowing about them helps determine beforehand if a claim has been made.