Life Insurance – Experience Placing Impaired Risk Cases
Finding low-cost life insurance isn't always an easy task. If there's a health problem in your medical history that raises red flags in the application process, you certainly want to enlist the help of an independent life insurance agent that has access to several different carriers and experience in dealing with the “knockout questions” on insurance carrier applications. These knock out questions apply to both medical conditions and prescription drugs.
Independent insurance brokers typically know which life insurance companies tend to offer the most competitively priced policies for applicants with certain medical conditions or risky lifestyles. For example, some insurers will offer better prices for people with heart disease or diabetes than other companies. Other life insurers are more lenient when it comes to cigar use or tobacco chewing. And still, other companies will quote better rates for nonmedical risks such as aviation, scuba diving or foreign travel. Captive Agents, those agents that work for your neighborhood Agencies like State Farm, Farmers, and Progressive might simply decline the case and either recommend an independent agent that can find the right coverage or simply say, I’m sorry I can’t help try someone else.”
Life Insurance – Experience Placing Impaired Risk Cases
Independent insurance brokers know which life insurers are likely to offer the best available life insurance quotes for these situations. They can informally shop around knowing the medical conditions and the underwriting guidelines with of the different insurance companies before submitting a formal application. Many independent agents band together to form large interest groups, in order to have access to a collection of the best way to place high risk conditions, yet meet underwriting guidelines. For example, FEX Contracting Group is a marketing organization that specializes in offering final expense life insurance has agents that have well over 25 years in the field. Over time the organization has maintained a proprietary listing of medical conditions and the companies that have suitable underwriting standards for that condition. There are agents across the country that are affiliated with this organization and what they’re able to provide for seniors requiring final expense benefits is an art.
For example, the group works with agents across the country who have clients with medical conditions. They know which insurance companies are likely to be the most lenient in underwriting a case and seek multiple competing quotes from those insurers.
"We get life insurance for people regardless of age, regardless of health, and we get them the least expensive insurance," says Scott Burke, who has over 20 years of experience in life insurance. Life insurers rarely give preferred or super preferred rates to applicants with medical problems. Clients with major health problems who receive preferred or super preferred rates should be cautious – the agent won’t be able to deliver that rate in the end.
However, the overall cost of life insurance is decreasing, as people are living longer. “The price of insurance has slowly gotten less expensive and is continuing to move in that direction,” Burke adds.
Finding a Qualified Independent Life Insurance Agent
Ask if the agent is a former insurance company underwriter or has any field underwriting experience. Former underwriters are often well connected with current underwriters and have direct experience setting policy prices for those with medical conditions. Former underwriters will know the positive indicators insurers look for when trying to make the best offer. This experience will allow the agent to put your case in the best light when he contacts an insurer.
Former managers at insurance companies, who have overseen underwriters, can also make good independent insurance brokers. They are especially valuable if they have supervised the processing of impaired-risk applications and are familiar with the risks involved in insuring people with medical conditions. This kind of experience can be difficult to quantify, but the very best will be agents that have up to date information on the underwriting guidelines for around 12 to 15 life insurance carriers.
Agents who have more than 10 years of experience, or who write 15 to 20 percent of their policies for people with health problems, can be knowledgeable and well connected as former underwriters. However, it’s best if your agent works with at least a dozen life insurance companies so they can truly get you the best coverage at the best rate.
Term life insurance is not usually, if ever, something you can just pick up the phone and order – and if it is, be skeptical! Be prepared to discuss any past or current medical conditions you have, any surgeries you have had, medications and/or medical treatments you are currently taking or have taken in the past, and possibly your family’s medical history. You may also be required to provide contact information of previous and/or current health care professionals by whom you have been treated.
You may be a bit hesitant to provide such personal information to a doctor that you may not even know; however, rest assured that all information is confidential and used only for your term life insurance application. The doctor will send the information directly to the insurance company.
Also, your agent or broker should obtain a copy of your medical records to review and fully understand your medical condition(s). Or you can provide a copy of them. If they don’t mention your medical records, they might be planning to treat your application the same as every other, hoping for a favorable result.
You’ll also need to obtain and sign a Health Insurance Portability and Accountability Act (HIPAA) release form, which your agent should provide, which allows them to share your medical information with the insurers listed on the form in order to find you the best coverage.
These programs have the following guarantees
1. First Day Coverage. You are fully protected the very first day your coverage goes into effect with no exclusions and no waiting period.
2. Ease of issue. No physical exams.
3. Your premiums will never go up. Lock into a rate at your current age and the cost will never increase regardless of changes to your health and age.
4. Your benefits will never go down. Regardless of changes to your health and age.
5. All programs build cash values.
6. The benefit is paid to your beneficiary tax-free on the worst week of their life.
7. Your policy can never be canceled as long as premium payments are made.
8. This is a protected asset that you will never be forced to liquidate.
Seniors looking for a state-regulated final expense life insurance policy or a whole life burial plan often have medical impairments and conditions that may raise the cost of these benefits. We keep track of these medical impairments and conditions and contract with several carriers so we can find the most benefits for the amount of money that you spend.
3 Top Reasons why folks use these programs
1. Because they do not have a DEDICATED amount for their funeral or final expenses
2. Because they’ve recently checked the pricing on what they currently have in place. They want to see if they can find more benefits than what they currently have.
3. Because they want to leave behind a legacy. Income for a surviving spouse, money for grandkids, or to charity (Cancer Society, Church, etc)
Finally, be honest about your health. If you lie, it can result in your application being declined and if you do get approved for coverage and the insurer finds out that you omitted something on your application they can simply return the premium you paid into the policy when you die instead of paying the death benefit.