High Risk Activity

In the context of Life Insurance and/or Living Benefits in Canada, a "High Risk Activity" refers to any hobby, sport, occupation, or behavior that significantly increases the insured's risk of injury or death beyond what is considered standard risk. Insurance companies assess these activities when determining policy terms, coverage eligibility, and premium rates due to the increased likelihood of a claim.

Key aspects of High Risk Activities include:

1. Examples: Common examples of high risk activities include skydiving, scuba diving, mountaineering, racing (car, motorcycle, boat), extreme sports, and certain occupations like mining, firefighting, or working in conflict zones.
2. Impact on Insurance: Engaging in high risk activities can lead to higher premium rates for life insurance and living benefits policies. In some cases, insurers may exclude coverage for deaths or injuries resulting from these activities or may offer coverage with specific exclusions or conditions.
3. Disclosure Requirements: Applicants are typically required to disclose participation in high risk activities during the application process. Failure to disclose such activities can result in the denial of a claim or the cancellation of the policy.
4. Specialized Insurance Options: For individuals who regularly engage in high risk activities, specialized insurance products may be available that specifically cover these risks, though these policies may come at a higher cost.
5. Underwriting Considerations: Insurers use underwriting guidelines to evaluate the risk associated with insuring individuals who participate in high risk activities. This evaluation can influence the decision to offer coverage and at what price.

Understanding the implications of high risk activities on life insurance and living benefits is crucial for individuals who participate in such activities. It ensures they can make informed decisions about disclosing these activities and selecting the appropriate insurance coverage to meet their needs.