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How To Get Temporary Life Insurance When You Buy Coverage

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If you’ve decided to get a life insurance plan, know your beneficiaries aren’t financially protected as soon as you submit your application. The review and approval process—called underwriting—may take six weeks or longer. In the meantime, you won’t have coverage—if you buy temporary life insurance.

What Is Temporary Life Insurance?

Temporary life insurance provides very short-term coverage, specifically during the underwriting process when applying for a life insurance policy.

Life Insurance underwriting is the process an insurer uses to ascertain whether you qualify for a policy and if that’s the case, at what price. The insurance company will review your application materials and, if applicable, the results of your daily life insurance medical exam.

The insurer could also certainly need to verify certain records, such as, for instance, your prescriptions. It may then determine your risk class and your daily life insurance quote.

Your insurance company may offer temporary life insurance once you apply for term life or permanent life insurance policy.

Not everyone qualifies for temporary life insurance. Whether or not temporary life insurance is offered depends upon the insurer and policy type.

This temporary insurance shouldn’t be confused with term life insurance, which covers you for a group period (usually 10 to 30 years).

How Does Temporary Life Insurance Work?

Temporary life insurance provides coverage when you look forward to your daily life insurance application being approved. If you die before underwriting is complete, your beneficiaries will receive a death take advantage of your temporary life insurance policy.

Once you’ve signed your daily life insurance application and submitted payment for the temporary life insurance, your temporary coverage kicks in.

Often, temporary life insurance lasts no more than 90 days. Within that timeframe, your temporary coverage will typically end for one of a few reasons:

  • Your life insurance application was approved, and your new policy is now in effect.
  • Your life insurance application was denied.
  • You didn’t proceed with the life span insurance application.
  • You didn’t respond to requests from the insurer information in a reasonable manner.
  • The death benefit was paid out beneath the temporary life insurance.

Where Can I Get Temporary Life Insurance?

Temporary life insurance is commonly provided by life insurance companies such for instance:

  • AIG
  • Lincoln Financial
  • Mutual of Omaha
  • Pacific Life
  • Protective
  • Prudential

How Much Does Temporary Life Insurance Cost?

Your insurance company will estimate your temporary life insurance premium based on the coverage amount you’re applying for. You will be billed for the same 1-month premium, and temporary coverage starts once that payment is received.

Remember that some insurers may cap the coverage amount for temporary life insurance, like a maximum of $1,000,000.

When the underwriting process for your new policy is complete, you’ll receive the official approval (or rejection), and your premium will soon be adjusted to reflect the particular cost of your new policy.

  • The payment you designed for temporary insurance may be applied toward your first month’s premium.
  • If your policy isn’t approved, the insurer will generally refund you for the temporary coverage.

Is Temporary Life Insurance Worth It?

Ask your daily life insurance agent if temporary coverage is available. If it is, locking in temporary life insurance is a smart move as it costs only your regular life insurance will. And it gives you the satisfaction that insurance is in place while you await your application approval.

Alternatives to Temporary Life Insurance

There might be instances when you don’t want or can’t qualify for traditional life insurance but have a wish for short-term life insurance. You may consider investing in a renewable term life insurance policy if you want life insurance for a short period.

Unlike traditional term insurance, which provides level premiums for 10, 20, 30, and 40 years, renewable term life insurance provides coverage for the starters year. At the end of every year, you can renew the policy at a higher rate each time. Therefore it’s best for those who desire to fill a short gap.

Brian Santiago

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