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11 Reasons You May Be Declined For Life Insurance
When you apply for life insurance, your potential provider will analyze several factors to determine if they are willing to offer you coverage and at what cost. Knowing why you may be declined for a policy can help you make more informed decisions when applying for and buying life insurance.
Top 11 Reasons You May Be Declined For Life Insurance
Getting a denial from anything that you want to acquire is frustrating. It is especially true with the life insurance application. Many people do not consider applying for one because of the fear of denial. There are many reasons why insurers deny an applicant.
Maybe because of their health issues, that is one of the most important considerations. However, it should not stop you from getting insured and secure your family’s future. Also, the fear of high rates must not hinder you from getting life insurance.
The underwriting process is the determining factor of the rates and coverage. The guidelines that you need to meet are not as hard as you think. In case you have experienced a denial before, do not lose hope. There are lots of options available for all.
Read on to find why an insurer might decline your application. Also, you will discover how to prevent it from happening.
Reasons Why Life Insurance Applications Are Denied
It is a lifestyle disease that is a massive problem in the United States. In 2016 the rate of obesity in the country reached 39.8%, and it is continuously rising.
Insurance providers pay attention to your overall health, and it includes your weight. The underwriting process has a specific guideline that provides information about your “build chart.” Inside the chart, you need to disclose your actual height and weight.
Each insurer has its own set of requirements when it comes to the build chart, so it is better to talk to an independent agent from Coach B. to find out which company is best for you. Some insurers might offer a lenient requirement when it comes to height and weight ratio.
2. High Cholesterol
Another reason why many insurers deny an application is because of the result of the medical exam. If it shows a higher level of cholesterol, triglyceride, and lipids, then an insurance company will do an intensive investigation about your health status. The total cholesterol is composed of HDL (good cholesterol) and LDL (bad cholesterol). If your result shows a higher amount of LDL than HDL, then it means that you have a chance of developing heart diseases or stroke.
Why would you be declined for life insurance?Insurance providers are interested in how much sugar you have in the body. The result of your blood sugar level will help them find out if you are a candidate for diabetes. A person with diabetes is deemed as a risk for insurers. The good news is that insurers can offer lenient requirements for people with high sugar levels. All you need to do is to ask the help of an expert agent.
4. Chronic Illnesses
People suffering from chronic illnesses have a lesser chance of getting approval. Many insurers do not want to take the risk of acquiring an insured within this health condition. However, you may still get the life insurance you need if you are being treated. Also, you need some documentation to prove it. It is better to prepare your medical records and list down your doctors and their contact numbers. The following are chronic illnesses that may encounter a denial:
- Heart disease
- Alzheimer’s disease
- Parkinson’s disease
Moreover, each insurer is different, so it is impossible to find one that can offer you the best deal for you. Also, each client has a different health condition. An independent agent will work hard to find a provider that best fits your condition and needs.
The only problem with getting older is the fact that you need to pay a higher premium. However, age is not a hindrance to obtaining a life insurance policy. Also, as people age, many health issues can make you a risk for many insurers.
Once you reach a certain age, then some policies do not apply to you. That’s why it is advisable to apply for life insurance while still young and in good shape. You will get more options for an affordable monthly premium.
6. Urine Result
An essential part of every medical examination is the urine test. It will show if you have protein and blood in your urine sample. In case it has, it is a sign of a health problem. Therefore, it might be the reason for a denial of your application. Insurers will request for further investigation or doctor diagnosis. It might be a symptom of a kidney illness.
If the result shows either blood or protein, it is better to follow up with your doctor. Your doctor will be the one to diagnose if there is an abnormality with your result. You can ask for a follow-up result to get the insurance that you need. Your agent will help you go through the process and will talk to the insurer.
If you occasionally drink, then you do not have to worry at all. However, if your result shows a higher liver function, then insurers will request for a test like a positive alcohol marker. It will determine if you are drinking more alcohol than usual. If it shows a high alcohol market, then you can face a denial.
8. Dangerous Occupation
Some jobs are riskier than others. If you are working in one of the below-mentioned fields, you are a significant risk for many of these insurers making these disqualifying conditions for life insurance providers. The following are occupations that are considered dangerous for insurers.
- Pilot and flight engineers
- Iron and steelworkers
- Logging workers
- Garbage or recyclable collectors
- Truck drivers
- Construction workers or laborers
- Framers and agricultural managers
- Electrical linemen, repairer, and installer
- Police officers and patrol officers
If you are working with one of these industries, you might find it challenging to get approval for insurers.
Family medical history is an essential factor for underwriters. They will try to find out if you have a family history of cancer. If you have, then it is a red flag for many insurance providers. Additionally, if you have a history of cancer, then an insurer will need more medical records. There is a higher chance of approval for other types of cancer, like skin cancer. If it is a serious one like breast or cervical cancer, they will need more records of your last treatment and follow up. The stage and location of cancer play an essential role in the decision making of insurers.
The number of years passed since your last treatment is essential to increase your chances of getting approval. Also, insurance companies may give a certain period before you can apply.
10. Financial Status
An important determining factor for your coverage and rate is your total net worth and income. Insurers have different internal restrictions. An insurer may deny the application of an applicant with $20,000 below income. An independent agent will suggest insurers that are according to your income bracket.
11. History of Denial
Last but an essential part of the underwriting process is your history of past denial. Underwriters will look for possible red flags. Having this history may affect your application.
What Makes You Uninsurable for Life Insurance
Life insurance companies are part of an institution with a database of information from clients. This agency is the Medical Information Bureau or MIB. All insurers submit the result of the underwriting process utilizing codes. Insurers share and get information from MIB to protect their company from fraud.
If you previously get a denial, it does not mean that you automatically get another rejection. Talking to an experienced agent will surely help you deal with insurers.
What Are My Alternatives To The Traditional Type Of Life Insurance Policies?
In case you do not fit into the traditional life insurance policy because of health conditions, you can always opt for no medical life insurance coverage. It is a policy that does not require any medical examination, but you will provide a medical record from your doctor or healthcare facility.
In the past, no medical coverage is the cost higher than traditional policies, but before. Today, insurers are offering competitive packages, rates, and coverage for their clients. However, remember that the underwriter will still look into your medical records, so if you have other issues, you need to disclose them to your agent to discuss them further.
Another great option is a Guaranteed Issue Policy. If you do not fit into a traditional policy and even for a no medical exam, this might be for you. It is for people who are disabled, with a severe health condition, mental disorder or have Social Security. You can choose this path. It is a policy that is available for people ages 50 to 85 years old. It does not require any medical examination.
Hence, it is better to keep in mind the waiting period of 2 years for Guaranteed Issue. It means that the beneficiary will only receive the premium back within two years. After two years, then the beneficiary will get the death benefit in full. However, it is also vital to take note that death must be from a medical condition.
If you fit in the 11 above situation, you should not lose hope as Coach B agents can find the best insurer that will fit into your case. The company has helped thousands of applicants, insured, and families all over the United States. We are licensed in almost 50 states, and we are an independent institution that serves the people. We are providing free services to our clients. All you need is to give us a call at 800-342-1537
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Apply again, But try a different life insurance policy
Suppose your situation is complicated and other routes (like your employer-offered life insurance we mentioned earlier) aren’t available. In that case, you could choose a no medical exam life insurance plan, but you would still have to answer some medical questions.
In a medical situation where your uninsurable, these types of plans will offer you something. Something is better than nothing. It’s always best to speak with an independent agent, life Coach B., then try and figure it out on your own.
Frequently Asked Questions
Which cases are likely to be declined by a life insurer?
Life insurance companies assess individual risk and decide whether or not to insure a person based on that assessment. Typically, those who are considered uninsurable for life insurance are people who have a greater-than-average risk of premature death. Some key indicators that make you uninsurable include having risky hobbies, a chronic illness, or an addiction to drugs or alcohol.
How to get life insurance if you have health problems?
Insurance companies can deny life insurance coverage if you suffer from certain medical conditions that increase the risk of premature death. Chronic illnesses like cancer, heart disease, diabetes, and kidney failure may disqualify you from life insurance. Mental health issues such as bipolar disorder can also be a reason for denial since these may cause turmoil in your daily life and increase your chances of unexpected death.
Why would a life insurance application be denied?
Life insurance companies can deny coverage for mental health issues like bipolar disorder, and you can also be denied life insurance due to depression. Mental health is a significant factor in determining if you qualify for life insurance. When applying for coverage, be honest about any mental health conditions, as it influences the rate you receive and can lead to denial of the policy altogether.
About Coach B.
After starting his financial career with Phoenix Home Life Insurance Company back in 1992, Scott decided he wanted to provide people with an easier and more enjoyable way to buy life insurance. That was the start of Coach B. Life Insurance, whose mission is to be transparent, honest, and helpful to customers — without ever bugging or pushing them.
In the years since then, he has worked tirelessly to improve the process of shopping for insurance. His goal is to make sure that everyone who comes to Coach B. — whether they end up buying a policy or not — has the best possible experience.