What Is the Two Year Contestability Period for Life Insurance?

Most states have either a one or two year contestability period for life insurance policies. If you are purchasing a new life insurance policy, this is something that you need to be aware of and understand. Here at Ty Lawrence Insurance Agency, serving the greater Austin, TX area, we want to help everyone understand what this is and how it can affect you. Here is what you need to know about the two year contestability period for life insurance. 

When you purchase a new life insurance policy, the insurance company has the option to delay and investigate a death that occurs within two years of taking out the life insurance policy. If they find that the death was caused by the pre-existing condition or a condition that the insured knew about, then they can deny life insurance coverage.

This is important for life insurance companies, as it helps ensure that those who find out that they are terminally ill cannot run out and buy a life insurance policy knowing that they will die soon. However, this is also important for you to understand, as it can help you understand why a claim may be delayed if your loved one passes away within this two year period. If it is deemed that the death was not caused by something they knew about, then the claim will be paid. 

If you are looking to take out a new life insurance in the greater Austin, TX area, Ty Lawrence Insurance Agency would love to help you. We can help you find the right policy and help you to understand it. Contact us today to get started and protect your loved ones in case of your untimely death today. 

What’s the Difference Between Term Life Insurance and Whole Life Insurance?

Life insurance allows you to provide for your family in the event that you pass away in Austin, TX. Your descendants can use the money to pay for your final expenses, pay off debts, and replace your income for a period of time. Having adequate insurance will help your family to not have to think about paying bills at a time when their hearts are aching. 

When you buy life insurance from Ty Lawrence Insurance Agency, you will make payments to the insurance company and if you die, the company will pay your family a lump sum. If you have a major life change, like getting married, having a child, or buying a home, you may want to adjust the amount of life insurance you need. 

There are two major types of life insurance policies. Whole life insurance policies are a lifelong commitment. As long as you pay the premiums, this policy will pay out when you die. Whole life policies also often have an investment or savings portion, from which you may be able to withdraw funds if you need them in an emergency. Term life insurance policies work differently than whole life policies. They are only good for a certain amount of time. The term could be 20 years or 30 years, but however long the term is, the policy will pay out if you die during that time period. Once the set amount of time is over, the policy expires and you are no longer covered. You receive no benefits or payments once the term is over. 

Term life insurance is typically less expensive than whole life insurance. The reason for this is that the term policies only are good for a set amount of time. Whole life policies are intended to be permanent and include the savings component.

If you have more questions about term or whole life insurance, you can call the Ty Lawrence Insurance Agency, serving Austin, TX and the surrounding area.