Why Do Some Life Insurance Policies Have a Waiting Period?

life insurance policy waiting period

Why Do Some Life Insurance Policies Have a Waiting Period?

When shopping for life insurance policies many people ask me if their coverage is guaranteed right away. Before I answer that question, you are probably asking yourself, what is a waiting period? A waiting period means that there is a specific period of time, such as one or two years, where the insurance company will only pay the dollar amount of premiums that have been paid into the policy to the beneficiaries. As an example let’s say a person has a $100,000 term life insurance policy that has a two year waiting period. If the insured person passes away during those 2 years the beneficiary will only receive the total of the premiums that have been paid up to this point. In this scenario, the beneficiaries will not receive the full $100,000 payout.

When people ask me if the life insurance policy they are applying for or shopping for is 100% guaranteed right away what they are asking is, if they pass away a day after or a month after the policy is in-force, will the insurance company pay their beneficiaries the full face amount of the policy? Unfortunately, I have spoken with customers who have gone through this exact situation expecting to receive the full amount of policy coverage and only received a tiny fraction.


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When shopping for life insurance quotes, this is one of the reasons why it is so important to ask questions about the life insurance quotes you are gathering. When it comes to shopping for life insurance, there is no such thing as a dumb or bad question. Make sure you ask:

  • Is this a temporary or permanent policy?
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  • If I pass away will the full amount pay out to my beneficiaries or is there any waiting period where they would not receive the full amount?
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  • Will this life insurance policy cover me if I pass away as the result of an accident, as well as natural causes or illness?

About the author: Dan Cody has been helping insure families for over seven years. He loves playing a variety of instruments including the guitar, bass, drums, and piano. He also supports cancer research foundations and volunteers at local pet shelters. Dan takes great care in identifying his clients’ needs so he can identify the policy that is best suited for their lifestyle. You can reach Dan at 1-800-651-1953 or DCody@Pivot.com.

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