An ABC news report has come out today regarding TAL LIfe adding COVID-19 exclusions to NEW insurance policies.
We have spoken to TAL and to clarify:
The exclusion is not being placed on any EXISTING polices and is not being placed on all new policies as a blanket exclusion. It is only being applied for those who may be in a higher risk area of contracting COVID-19.
Whilst this seems unfair for any clients in these categories the rationale behind it (and no,I am not defending the position entirely, but can understand it) is that for the clients who already have cover with TAL Life if they (TAL) had an increase in claims on policies for COVID then this would force premiums up (further) in the future. Therefore they are trying to protect the existing clients from paying for the new disease.
Will other insurers follow suit? They are all considering it for new business, however all may not go to the same extremes. The pressure actually comes from the re-insurers to place the exclusion on the new policies. This is because the re-insurers are global and they are exposed to possible massive claims due to COVID so they to are trying to flatten their curve....
If you have any questions regarding this please do not hesitate to call Ben, Cara or Stuart in the financial planning team.