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Coronavirus or COVID-19 has been declared as a pandemic by the World Health Organisation (WHO). The virus has been constantly increasing the death toll by infecting people across the globe.

Lakhs of people have been tested positive for COVID-19 and several have even succumbed to its adverse effects. In India alone, thousands of individuals are infected with this virus and several have even passed away. 

With the uncertainty rising, the importance of life insurance has become significant, as it is an efficient way to protect their family from financial instability. But the burning question remains- Will life insurance cover the death of a policyholder caused due to coronavirus? 

Existing Life Insurance Cover for Death due to Coronavirus

If an individual passes away because they are infected with coronavirus, and they had life insurance to protect them, then they are eligible for the death benefit. In such a case, the nominee of the life insurance policy will receive the sum assured as the death benefit. 

Hence, the beneficiary or nominee of the deceased person must be aware that the death of the policyholder caused due to health-related issues is more or less covered under the life insurance policy. This also includes term insurance.

Furthermore, even though some life insurance policies exclude specific causes of death, death due to coronavirus is without a doubt applicable to the death benefit.

Death benefit includes the agreed amount of money, called as the sum assured, which is paid by the insurance provider upon the death of the policyholder to the beneficiary or the nominee. A nominee is a person who is listed by the policyholder when purchasing the life insurance policy. The sum assured as death benefit can be checked by the nominee in the policy document.

With the pandemic hitting the Indian subcontinent, life insurance can be a boon for those who want to secure their immediate family now. But will a new insurance policy be applicable in case of death due to coronavirus or is it just for the existing policyholders?

New Life Insurance Cover for Death due to Coronavirus

If you have considered buying life insurance, then you must bear in mind that your insurance premium is determined based on your health and medical history, and purchasing it amidst this global health crisis is bound to have an impact on both the acceptance of your policy application and the cost of its premium. 

Unfortunately, those who have already contracted the coronavirus infection will have their life insurance policy application rejected by the insurance provider. However, if you disclose your medical history precisely at the time of your purchase, wherein you are not infected with coronavirus, then your application will most definitely be accepted. This allows your death benefit to be payable to your nominee in the future even if you pass away due to coronavirus infection.

Nonetheless, you, as a policyholder, must scrutinize every aspect of your insurance policy to understand the various inclusions and exclusions before your purchase. This is because a few insurance providers do not entertain a claim for critical illnesses if the policyholder did not abide by the medical advice.

COVID-19 – A Critical Illness

Life insurance policies also provide coverage against life-threatening diseases, where they pay a lump sum amount to cover high medical expenses. Where such policies do not deny payment for death caused by critical illnesses, they do have certain conditions in place, which must be adhered to. This are more or less medical advice that the policyholder must follow to protect themselves from contracting the critical illness.

You must bear in mind that even though COVID-19 is covered as a critical illness, benefits will be paid out as per your policy’s terms and conditions only. For example, a policy may state that the critical illness benefit will not be applicable if the illness is caused by any of the listed conditions, and death has occurred within the 30 days of its diagnosis. 

Hence, if you have plans to travel during this global crisis, it is best to cancel them as it is against the medical advice for preventing the coronavirus infection. Failure to abide by this can lead to rejection of your claim in the future.

Read: Revival of Lapsed LIC Policy – Steps to Revive It Online

Does COVID-19 Fall Under Force Majeure Clause?

Considering the nature of force majeure clause, where unforeseen events such natural disasters, war, strikes, epidemic, pandemic, etc. will invalidate the life insurance policy, it is imperative to understand whether it is applicable for coronavirus. 

As per the press release from the Life Insurance Council, the Force Majeure Clause will not apply in case of COVID-19 death claims. The Life Insurance Council, which coordinates between the Government, the Insurance Regulatory and Development Authority, and the public, has hence announced that all the insurance companies, both private and public, will process the death claims related to coronavirus at the earliest.

As for those who do not have this clause in their life insurance policy, their death claims due to COVID-19 will be accepted, provided all the details that were declared when purchasing the policy are correct.

Naval Goel is the founder of He is an Associate Member of the Indian Institute of Insurance`, Pune. He has been authorized by IRDA to act as a Principal Officer of Insurance Web Aggregator.
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