What happens if you miss a monthly Premium on your Protection policy during the Covid 19 Crisis?

//What happens if you miss a monthly Premium on your Protection policy during the Covid 19 Crisis?

What happens if you miss a monthly Premium on your Protection policy during the Covid 19 Crisis?

April 20th, 2020

What are the consequences if you miss a monthly Premium for your Protection policy? **

In these unprecedented times we are all being advised to ‘manage our cashflow’ and cut back on unnecessary expenditure in order to get through this crisis.

One effective way to do this is to do a full assessment of your recent bank statements and decide which direct debits to cancel and which to keep.

What are the consequences if someone is having difficulty paying the premium on their protection policy such as Life Insurance, Mortgage protection, or Serious Illness cover?  

Life companies recognise that these times call for additional flexibility for their policyholders. Most Life Companies have a ‘reinstatement’ option built into their Protection Policies.  This allows the policyholder or their legal representative pay the unpaid premiums due on their policy within a specific date on which the first unpaid premium was due and have the policy reinstated.  The timeframe from the unpaid premium varies from one Life Company to another.

At the time of writing this a number of Life companies have clarified their position regarding the flexibility they are giving their clients.

New Ireland

 The policy holder has the right to pay the unpaid premiums due on their policy within 12 months of the date on which the first unpaid premium was due and have the policy reinstated. The policy can be reinstated even if a claim has arisen. The provision does not apply if the policy is cancelled by the policy holder, and bear in mind a Declaration of Health is required after 90 days.

Separate to this, New Ireland are offering a 3 month Mortgage Protection premium waiver to customers who have been granted a payment break on their mortgage. The 3 months premiums will not be required to be repaid at a later date.

Irish Life

 The policy holder has the right to pay the unpaid premiums due on their policy within 6 months of the date on which the first unpaid premium was due and have the policy reinstated. The policy can be reinstated even if a claim has arisen. The provision does not apply if the policy is cancelled by the policy holder, and bear in mind a Declaration of Health is required after 90 days.

 

Royal London

Royal London are providing a 3-month premium deferral option during the current crisis.  During this 3-month period, no premiums will be payable, but cover will continue to be in place. At the end of the premium deferral period, the premium arrears due can be repaid at that point or spread out over the upcoming 12-month period. You can choose the option that suits you best.   Any claim during the premium deferral period will be paid, in line with their usual claims philosophy and assuming the premiums due are repaid.

 

Zurich

The policy holder has the right to pay the unpaid premiums due on their policy within 6 months of the date on which the first unpaid premium was due and have the policy reinstated. The policy can be reinstated even if a claim has arisen. The provision does not apply if the policy is cancelled by the policy holder, and bear in mind a Declaration of Health is required after 90 days.

 

Aviva

The policy holder has the right to pay the unpaid premiums due on their policy within 6 months of the date on which the first unpaid premium was due and have the policy reinstated provided that you inform Aviva in writing and provide Aviva with such medical and other evidence of good health, and pay all outstanding premiums within the 6 months.

 

Do not do anything hasty, consult with your financial advisor before altering or cancelling your premium.

 ** Source:  Wealthwise Financial Planning

 

By |2020-04-28T12:53:52+00:00April 20th, 2020|News|0 Comments

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