Life Insurance: What information must be reported to the insurer during the term of the policy?

When Portuguese people think about protecting and securing their lives, the first thing that comes to mind is life insurance.

According to the Insurance and Pension Fund Supervisory Association (ASF), more than 6 million Portuguese citizens are covered by life insurance, and the explanation is relatively simple.

With life insurance, Portuguese citizens not only ensure financial protection in the event of death or disability, but can also obtain coverage for expenses related to serious illnesses, among other things.

These figures leave no doubt as to the importance of life insurance in the daily lives of the Portuguese. But did you know that, after purchasing a policy of this type, you’ll have certain obligations to fulfill, including regularly providing specific information to the insurance company?

Let's find out what information you are required to provide to the insurance company once the policy is in effect.

What life insurance information must be disclosed?

Throughout the term of your contract, you must provide the following information to the insurance company:

• A change in profession or high-risk activities/sports;
• Change of address (for mailing purposes only; has no impact on risk);
• Updating irrevocable beneficiaries (e.g., change of bank);
• Capital increases/credit holders (the insurance must be updated to always reflect the outstanding principal and the individuals covered by the credit);
• Trips abroad lasting more than 30 days.

What information does not need to be reported?

Once the insurance policy takes effect, you will not be required to report any changes in your health status.

We would like to emphasize, however, that during the life insurance application process, you must inform the insurer of any medical changes that are relevant to the preparation of the policy.

Consequences of Failure to Report Changes

If you fail to report changes during the term of the life insurance policy, you may, among other things:

• Have their contract terminated;
• In the event of willful omission, you will be required to pay the premium due through the end of the contract;
• To have the contract amended at the insurer's request;
• If a claim arises due to an omission or negligence in the provision of information, the insurer will cover it in proportion to the difference between the premium paid and the premium that would have been due had the insurer, at the time the contract was entered into, been aware of the fact that was omitted or inaccurately stated.

It may also happen that, in the event of a claim, the insurer does not cover the claim and is only obligated to refund the premium.

When should you report the changes?

You should report any changes to your life insurance policy as soon as they occur. However, some changes may be the perfect opportunity to reassess your coverage.

For example, if you are traveling abroad, have changed jobs, or have moved, you should provide this information as soon as possible. If we’re talking about capital increases or changes to the credit holders, the change must be requested promptly, but we recommend that, as mentioned, you take this opportunity to review the contract.

When is the best time to review your life insurance?

Your financial and family circumstances change over time, which can ultimately have a direct impact on the contracts held in your name, particularly your life insurance policy.

Among other things, these changes may mean paying a lower premium—due to lower risk for the insurer—or even enjoying better coverage by taking advantage of any promotional offers.

Therefore, if any of the following situations apply, you should consider reviewing your life insurance:

• Birth of a child;
• Purchase of a property;
• Change in Marital Status (marriage or divorce);
• Change in occupation/loss of benefits;
• More favorable contract terms.

Information is essential

As with other types of insurance solutions, information is essential so that the insurer can not only calculate the premium you’ll pay more accurately, but also recommend coverage that best suits your needs.

In addition, if there are any changes in your professional situation, or if you wish to update your beneficiaries or increase your coverage, this information will be essential for reviewing your life insurance policy; you may even want to take this opportunity to look for a better option for yourself.

If you decide to reassess your life insurance, know that you can count on the support of EXS Seguros and its experienced professionals to help you find a solution that provides you with maximum protection at minimal cost.

Don't hesitate—order yours now Free trial!