Most people don’t realize that there is a waiting period that comes along with some life insurance plans.
If you were to pass away during the waiting period, your beneficiary wouldn’t receive the full payout from the policy.
Instead, they will only receive the premiums that have been paid into the policy. The waiting period means that the insurance companies withhold full coverage for health reasons for a period of two years. The premiums paid during that period will be considered only for partial benefits.
You will get the full benefits after you survive the waiting period. If you die during this period, your beneficiary will get the premiums that you paid and an interest which is typically 5-10%.