LIFE INSURANCE

Is there a period of time during which after I purchase my life insurance policy I can change my mind and have my money refunded?
Yes, the Insurance Law requires a period of not less than ten days nor more than 30 days from the date the policy is delivered to you. The insurer must refund to you any premium paid, including any policy fees or charges.

What happens if I forget to pay my premium by its due date?
Your life insurance policy will provide for a 31 day or one month grace period within which you can still make your premium payment. Your policy will continue in force during that time. Universal Life type policies will generally have a grace period of 60 days.

If I pay my annual premium and then decide to cancel my policy, will I receive a pro rata refund of my premium?
An insurer is not required under the Insurance Law to refund any portion of your annual premium if you choose to cancel your policy during the year.

What if I made a mistake in completing my application for a life insurance policy? Can the insurer void my policy?
A life insurance policy will be incontestable by the insurer after being in force during the life of the insured for a period of two years from its date of issue. The insurer must show that a material misrepresentation was made in the application.

What happens to a life insurance policy in the event of suicide of the insured?
If the insured dies by suicide during the first two policy years, the insurer will refund the premiums paid and the death benefit will not be payable.

In order to purchase life insurance I am told I must have an “insurable interest” in the person to be insured. What is “insurable interest”?
The Insurance law defines “insurable interest” as, in the case of persons closely related by blood or by law, a substantial interest engendered by love and affection. In the case of other persons, a lawful and substantial economic interest in the continued life, health or bodily safety of the person insured, as distinguished from an interest which would arise only by, or would be enhanced in value by, the death, disablement or injury of the insured.

If there is a delay in an insurer paying the death benefit to the beneficiary when a death claim is made, is the beneficiary entitled to any interest on the death benefit?
Yes. The Insurance Law requires that interest computed daily at the rate of interest currently paid by the insurer on proceeds left under the interest settlement option be paid from date of death to date of claim.