How Insurance Companies are Adapting to the “New Normal”

With the advent of Covid-19, daily life requires a new kind of adaptation for companies big and small. Beyond places that rely on customers to gather in large groups — such as stores, gyms, movie theaters and restaurants — many remote-working companies have also been affected. No surprisingly, insurance companies are making policy changes in response to the Coronavirus pandemic, from travel coverage and life insurance to auto protection and health coverage. Read on for how insurance companies are evolving to meet the demands of the “new normal.”  

Waiting Period

The underwriting process and the applications are still the same. Insurance companies have always asked about international travel plans. Still, travel to and from countries battling the Coronavirus can affect when your life insurance kicks in. According to the CDC, it can take from two to 14 days for someone to show symptoms, and insurance companies take care to reflect this delay. 

The big difference between now and before the pandemic lies in whether a person has been diagnosed with COVID-19. If so, many life insurance companies will require the person to wait for 30 days before approving the application. 

Virtual Application and Exams

When doctor’s offices closed in different parts of the country, some insurance agencies provided a virtual application method for no-contact processing. Bypassing the traditional medical workup, these insurance companies are turning to predictive models to assess a potential client’s current state of health, when a medical exam isn’t available. 

Approved applicants receive insurance without the medical exam. Once approved, some companies are also waiving copay fees for telehealth access, as well as allowing COVID-19 treatment without pre-authorizations or referrals. 

Continued Coverage

For those who haven’t been able to meet their payments due to a job loss because of the Coronavirus, policies typically offer a 30-day grace period where the policy is still active. Some companies are adding days to the grace period. In places such as Montana, state regulators have upped the mandatory grace period to help ensure continued coverage. 

Other insurance companies, even those without state mandates, have made changes on their own. If you continue to keep up on your insurance payments, and you are truthful about the state of your health, your insurance payout won’t be affected in the event you come down with COVID-19. 

No (or Reduced) Late Fees

Though some states are more adamant about late fees, some insurance companies have reduced or done away with late fees altogether. USAA, for example, didn’t charge late fees and kept property and auto policyholders’ accounts active for those needing more time to pay because of the Coronavirus. 

This move was automatic and didn’t require any work on the part of USAA members. USAA also provided special payment arrangements on auto, health, property and life insurance when requested by its policyholders. 

Some companies provided a dividend due to a reduction in accident claims and reduced driving across the board. Back in April 2020, USAA gave their auto insurance policyholders a $520 million dividend, followed by a second $280 million dividend, according to a company press release. 

Peace of Mind

Once you purchase an insurance policy, your policy shouldn’t suddenly be changed by the insurance company. With the Coronavirus lurking in the background, most people now recognize the importance of insurance. If you need coverage or would like to change insurers, research each policy to ensure you’re getting the protection you need during this unprecedented time.