A life insurance policy goes into effect after the application has been submitted, the underwriting has been completed, the life insurance approval has been made, the policy has been issued, and the policy holder and insured person have signed any necessary delivery requirements and made the first premium payment by check or auto draft.
Founder, Abrams Insurance Solutions, Inc., San Diego, CA
Most life insurance companies also offer temporary insurance which can start when the application is submitted with a premium. Most carriers require 2 months premium payment and a signed temporary insurance agreement to put the coverage in effect. If the client does not take the insurance policy for any reason, or it is not approved, then they will get a refund of the initial premium.
Agent Owner, Gilmore Insurance Services, Marysville, Washington State
Life insurance usually goes into effect after the policy has been accepted by the insured and payment received by the insurance carrier.
Coverage can also be in effect in a temporary manner prior to policy issue while underwriting is in progress. Companies will accept a conditional receipt along with first month's premium with the application and apply that coverage for 60 to 90 days depending on the company. Some will provide coverage from the application it's self and others after the medical exam is completed. It can be different in many situations. Please read the temporary receipt before you sign it to see if it seems reasonable to you.
Syndicated Financial Columnist, Host of the weekly talk show Steve Savant's Money, the Name of the Game, Scottsdale Arizona
When the life insurance company has reviewed your application it will make a decision on whether to make you an offer, postpone the offer or decline the offer. If they offer you a price tag that you feel is fair, then you accept the offer, write a check for the modal premium agreed upon and sign the delivery requirements to put the policy in force.
If a life insurance policy is medically underwritten, it will go into effect after the policy is approved and issued and delivery requirements are received. If it is a No Exam policy, the policy can go into effect as soon as the policy is approved, which could be as short as hours after applying. You must be sure to have enough money in your checking account to be drafted as soon as a No Exam policy is approved.
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Coverage can also be in effect in a temporary manner prior to policy issue while underwriting is in progress. Companies will accept a conditional receipt along with first month's premium with the application and apply that coverage for 60 to 90 days depending on the company. Some will provide coverage from the application it's self and others after the medical exam is completed. It can be different in many situations. Please read the temporary receipt before you sign it to see if it seems reasonable to you.