Breaking News
LAST CHANCE for Cyber Monday SALE: Up to 54% off InvestingPro! Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Life insurers shift to pre-pandemic norms after COVID vaccine roll-outs

Stock MarketsSep 02, 2021 08:55PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. FILE PHOTO: Syringes with the Moderna coronavirus disease (COVID-19) vaccine are seen in a vaccination center at the Caisse Primaire d'Assurance Maladie (France's local health insurance funds - CPAM) in Bobigny near Paris as part of the COVID-19 vaccinati

By Carolyn Cohn and Noor Zainab Hussain

LONDON (Reuters) - The roll-out of COVID-19 vaccinations is making life insurers more enthusiastic about offering cover to those with underlying health conditions - some without even knowing whether customers have been vaccinated.

Life insurers were imposing waiting periods to buy cover in the early stages of the pandemic for certain age groups, as well as for those who had been infected, saying the long-term health consequences of coronavirus were not fully understood.

But now that vaccines are prevalent in major economies such as Britain and the United States, life insurers see fewer risks.

Helen Croft, head of underwriting strategy at AIG (NYSE:AIG) Life, said the insurer had previously been more cautious in offering cover as a result of the pandemic, but the efficacy and widespread use of the vaccine meant it could provide insurance for more customers.

"The vaccine take-up has been excellent," she said. AIG Life did not check if individual customers have been vaccinated, with Croft pointing out the insurer did not ask customers about other inoculations, such as for flu.

"I don't think it's necessary to be asking about the vaccine - the population level take-up gives us enough comfort," she said.

Insurers such as LV=, Aviva (LON:AV) and Zurich also said they did not ask vaccination questions, with Zurich highlighting the possible limitations of inoculation, such as long-term effectiveness or the impact of new variants.

Regardless of vaccination status, customers with underlying health conditions may pay up to five times the standard rate for life insurance products, sources said.

A reduction in the hospitalisation and death rate as a result of vaccination has meant that "almost all" insurers in Britain have reversed previous COVID-19 restrictions on life cover, said Phil Jeynes, director of corporate sales at insurance broker Reassured.

Britain was one of the first countries to roll out a vaccination programme and almost 80% of all over-16s are fully vaccinated, according to UK government figures.

Premiums have stayed much the same during the pandemic, Jeynes added. Rather than raising rates, insurers postponed providing cover for those above a certain age, with some underlying health conditions or who were recovering from COVID-19, industry sources said.

Life insurance premium volumes dropped by 11% in Britain and by 0.1% in the United States in 2020, according to Swiss Re (OTC:SSREY). Sharp (OTC:SHCAY) falls in household incomes due to lockdowns and job losses hit demand for life insurance last year, the reinsurer said in a recent report.

Swiss Re expects strong life insurance growth this year and next due to the economic recovery and increased consumer awareness of risk.

In the United States, where more than half of the population is vaccinated, major life insurers Prudential Financial (NYSE:PRU) and Lincoln told Reuters they did not ask about vaccines.

The Insurance Compact, standards adopted by 47 U.S. states, said it did not currently allow insurers to ask vaccination questions as state insurance regulation has not yet set public policy around the vaccine and underwriting.


However, some insurers in Britain are asking customers whether they have been inoculated, particularly if their health condition makes them more vulnerable to COVID-19, and this could affect the cost or size of their cover.

"For those that have been fully vaccinated, our risk appetite will be higher," said Rose St Louis, protection director at Scottish Widows. "We may be able to offer improved terms to those who have had both vaccines."

Legal & General typically imposes a 12-month waiting period on customers who are clinically vulnerable and where the impact of COVID-19 may be life-threatening.

"To avoid postponing applications for this 1% of new customers, we will now ask whether or not they have had their required vaccine doses...allowing us to give cover to customers when it would otherwise not be available," an L&G spokesperson said by email.

Unvaccinated vulnerable customers would be declined cover for now, though allowances would be made for those who could not have the shot for medical reasons such as pregnancy, L&G said.

Insurers need to get clearance from their reinsurers for any underwriting changes they make, as reinsurers may otherwise be unwilling to provide that cover.

L&G said its reinsurers agreed with its approach, without naming them.

One global reinsurer, who declined to be identified, said it was supporting the stance of "several insurers" in Britain who were insuring customers in higher risk medical groups for larger amounts of cover, if the customers provided evidence that they were fully vaccinated.

Clive Allison, director, life and pensions at consultants EY, said the need for vaccine questions may be short-lived.

"There'll be a convergence where most adults will have been double-vaccinated," he said. "The ones that haven't are most likely to be in the younger age bracket, and typically are not looking to take out insurance cover."

Life insurers shift to pre-pandemic norms after COVID vaccine roll-outs

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email