Effective Date

The "Effective Date" in the context of life insurance and health insurance refers to the date when an insurance policy becomes active and coverage begins. From this date forward, the insurance company agrees to provide the coverage outlined in the policy, assuming all conditions such as premium payment have been met. The effective date is crucial because it marks the beginning of protection for the insured, ensuring that any eligible claims made after this date are covered according to the terms of the policy.

Understanding the effective date is important for policyholders to ensure they know when their coverage starts, especially since any claims made before this date typically will not be covered. It is also essential for coordinating the transition between old and new insurance policies to avoid gaps in coverage. The effective date is specified in the insurance contract and is determined at the time the policy is issued, often after the application has been approved and the first premium has been paid.