Rhode Island Life Insurance

As in most states, the Rhode Island life insurance industry is strictly regulated — this ensures that providers offer fair and consistent terms. Every policy must include a set of standard provisions to keep you safe. As you consider your options, check for compliance with these requirements; it's a simple way to identify trustworthy insurance companies. 

Rhode Island Life Insurance Rules and Specifics

The Insurance Division of the Rhode Island Department of Business Regulation handles all the enforcement activities for the state's insurance industry. To guide regulation, officials use Chapter 27 of the Rhode Island Code.

Right to Examine and Return

All life insurance policies issued in Rhode Island must come with a free look period of 20 days, which starts the day the policy is delivered. During this time, you can examine the policy — you might bring it to your lawyer or estate planner for review. If you decide it doesn't suit you, the law allows you to return it for a refund.

Grace Period

Rhode Island law gives you a 31-day grace period on every premium after the initial payment. If you aren't able to make a payment on time, you have 31 days to catch up. Your coverage remains active during this period. If the account is still delinquent after 31 days, the company has the right to cancel your policy.

Subjects of Abuse

If you're the subject of abuse, your life insurance company may not discriminate against you. The law prohibits companies from taking certain actions based on your status as an abused person, including:

• Denying coverage
• Excluding, denying or limiting benefits
• Revealing information about the abuse to anyone but a doctor

Interest

When you pass away, your life insurance provider must start paying interest on your death benefit. The interest, which is set by the state at 9%, starts accruing from the date of death.

Incontestability

Rhode Island has a standard incontestability provision. It states that after you pay the premiums on your life insurance policy for 2 years, the provider can't contest it. There are two possible exceptions:

• Your policy is canceled for lack of payment
• You experience an accidental death or total and permanent disability, and you have separate coverage for those situations

Life Insurance Resources in Rhode Island

• Insurance Division, Rhode Island Department of Business Regulation: In addition to regulating life insurance companies, the Insurance Division offers consumer education and service. They answer questions, take complaints and offer a licensing database for easy look-ups.
• Rhode Island Life & Health Insurance Guaranty Association: If your insurance provider goes under, this organization will help pay the cash value or death benefit.
• American Council of Life Insurers (ACLI): Learn more about the life insurance industry on the ACLI website; the glossary, in particular, can help orient you to the jargon in your policy.