‘Hot Spots’ coined by the insurance companies are locations of the world where it is deemed dangerous to travel to. For an insurance company this means that the risk of death while visiting these hot spots is far greater.
When applying for life insurance one of the questions your broker will ask you is whether you have travelled in the last 2 years or if you plan on travelling in the near future. Of course we all plan on travelling in the future so unless you have tickets booked for travel there is no need to share your vacation dreams! However, you should know that if you do have tickets or regularly travel to a hot spot you may get an exclusion or a rating. An exclusion means that the particular country or part of the country you are travelling to is deemed unsafe so if you were to die in that location, the insurance would not pay out the death benefit. If you got a rating, the premiums you pay for your life insurance would be higher because the insurance company looks at your travelling and determines that you are a higher risk applicant.
Travel Exclusions and Ratings
Travel exclusions can be removed so if the situation in a part of the world ameliorates, the exclusion will be lifted but, make sure to ask your broker to confirm the exclusion status before you travel. If you receive a rating and the situation in that hot spot improves, call your broker and ask them to inquire about removing the rating on your life insurance policy.
[success title=’INSURANCE BROKER TIP!’]While every insurance company asks travel questions, some companies pay closer attention to hot spots than others. If this is a concern you might have, speak to your broker and let them know so that they can help you determine what insurance companies to apply to.[/success]
