or Everything You Wanted to Know About Life Insurance* * But were afraid to ask
Contents Pre-Existing Conditions and Life Insurance 3 How Long Does It Take to Get a Term Life Insurance Policy 5 Insurance Medical Exam 8 Life Insurance Blood Test and Urine Test 11 Life Insurance Underwriting 13
Chapter 1 Pre-Existing Conditions and Life Insurance Many of us have medical conditions that will be considered pre-existing when we apply for life insurance. Clients always want to know how these conditions will affect underwriting. An underwriter will consider your overall health, medical treatment, health history and family history before determining your rating category. Underwriters take many things into consideration when evaluating your pre-existing conditions. 1. Probably most important.can your health condition affect your life span? 2. Is your health condition in remission or under control? 3. Do you regularly see a doctor to treat your condition? 4. Do you follow your Doctor s orders? 5. How long have you had it? 6. Do you have any associated conditions from the primary health condition? Once again, this is where an independent life insurance agent can be very helpful. Your agent should know which companies will underwrite your condition most favorably. 3
We use an independent underwriter to give us assistance with which carrier(s) will view your health picture in the best light. Additionally, they can directly contact the underwriter evaluating your application if needed, while an agent cannot. Certain pre existing conditions may require a waiting period before you can qualify for insurance. Certainly no company is going to insure you if you had a heart attack last month. After a period of time, with no further incidents and regular medical care, you may qualify, and very possibly at reasonable rates. (Every case is looked at individually and all factors are taken into account). Diabetic pre-existing conditions can usually qualify for life insurance. Your rating will be directly affected by how well you are controlling your diabetes. Uncontrolled, diabetes can lead to associated conditions that can certainly affect your life span and this would affect your ability to obtain life insurance. Cancer is another common pre-existing condition. Underwriting will depend on the type of cancer, the stage at diagnosis, the pathology report, when the cancer occurred, your treatment and if there have been repeat occurrences, etc. The Bottom Line Possible pre-existing conditions are too numerous to mention. Suffice it to say, your independent life insurance agent will be able to find out how your pre-existing condition(s) will likely affect your insurance underwriting. 4
Chapter 2 How Long Does It Take to Get a Term Life Insurance Policy? How long does it take to get a term life insurance policy in force? For now, I will assume that you are applying for coverage that requires a medical exam. The quick answer is that you can have coverage in place as quickly as 2 weeks, or it could take six months or more. However, most cases are between one and two months. You and your agent are the most important factors in the timetable. Your agent is responsible for getting you the application, setting up your exam, sending that exam to the carrier, and getting any other requirements the insurance company wants. The more organized your agent is regarding follow up, the faster requirements get completed. If you want a speedy turnaround time, you have to respond to your agent s inquiries promptly! In our office, we communicate with our clients at least weekly to inform them of any outstanding requirements and/or keep them apprised of where they are in the underwriting process. 5
Your time frame in returning the application to your agent is the first step. Well, actually, how fast do they get the application to you? Next is how quickly can you have your paramedic exam? After that, the ball is in the insurance company s court. Life insurance underwriting is the next step! Once the insurance carrier has your application and paramedic exam, your lab results will be ordered. This will go to an underwriter for an initial review. If no other information is needed, your application can be approved with this information. Usually these are policies where the insured gets a super-preferred or preferred rating (the two best underwriting classes). Based on your medical history and your lab results, the underwriter may want to review your doctor records. This is where things can bog down! The records get ordered and... I have seen records come in the next day, and I have seen records take 2 months or more to be released. If your records are at the VA Hospital, or Kaiser Permanente or another large HMO or hospital, they may require a special authorization as well (and it may take 1-2 weeks to find this out). A good agent calls the doctor s office to see if a special authorization is required- sometimes we can save 2 weeks with just one call! 6
Then your agent should follow up regularly with the copy service to move this process along and, if necessary, have you call the doctor directly to assist. So all in all, you and your agent are the most important factors in keeping your application moving through the process. In general, without medical records being ordered we have policies in place usually within two to four weeks. With ordering records we average about one and a half to two months. We try to make the process painless for you by keeping on top of things! 7
Chapter 3 Insurance Medical Exam Most insurance companies require all applicants to have an insurance medical exam, also called a paramedic examination. Many clients want to know if they can use results from a recent doctor visit so they do not need to do the blood and urine portion of the exam. Unfortunately the answer is they cannot. The insurance company needs independent results for two reasons: Chain of custody. The insurance companies want to be certain that they are looking at your results. The insurance company will test for things your doctor won t such as nicotine, drugs, certain liver and kidney functions. If they want more tests, the samples will be available to them. The insurance medical exam performed by a paramedic does not require disrobing. The amount of coverage you are applying for and your age will determine the specific requirements. 8
Most exams will include height and weight, blood pressure, pulse rate, and blood and urine samples. They may also include any or all of the following: Complete medical history Resting EKG Mature Age Supplement M.D. Evaluation To prepare for your exam you should be fasting for eight hours. Drink water before the exam as this will help you provide a urine sample and will make drawing your blood easier for both you and the examiner. Also, refrain from stress or exercise before your exam as they will impact your blood pressure and EKG results. If you take medications always take them at your regular time and alert the examiner to include that in the paperwork. If you forget to fast, and eat before the exam, the best thing to do is to reschedule the blood and urine, but complete the rest of the exam. Many of the lab results can be affected negatively by eating. You will need to show your driver s license to the examiner for identification purposes. Have your doctor s address and phone number ready for the examiner, as well as the last time you saw the doctor, the reason for the visit and the recommended treatment. If you take any medications, have them available for the examiner. 9
Generally the exam takes between 20 to 40 minutes depending on the requirements and amount of medical history. You can request a copy of your lab work through your agent. While there are companies that offer life insurance without a medical exam, we find using a top rated carrier that requires an exam will usually save you money on your premium. An insurance medical exam and blood test can lower your premium and the savings can add up to thousands of dollars over the life of your policy. It s well worth your time! 10
Chapter 4 Life Insurance Blood Test and Urine Test When you apply for life insurance most policies require that you have a paramedic exam. Part of that exam is collecting blood and urine samples for testing. Clients often ask if they can go to their doctor to do the test. Sometimes the client has recently visited the doctor and had labs completed. They want to know if those results are acceptable to the insurance company. The short answer is no, you are required to have this independent exam including blood and urine collection and here s why! 11
What s different about the Life Insurance Blood Test and Urine Test? 1. Your blood and urine specimens go in a direct line from the examiner to the laboratory and the laboratory to the insurance company. The sample vials are marked in your presence and the numbers match your paperwork. The insurance company can be sure these are your blood and urine samples. 2. The insurance company does several different tests than your doctor will perform at a routine checkup. These tests may include additional liver enzyme levels and/or A1C testing (long term blood sugar measure). Insurers will also check your blood and urine for signs of nicotine and drug use. 3. When the insurance company receives your lab results, they may decide that further testing is indicated to either re-check a result or do a more detailed study. If so, your blood is available at the laboratory for a period of time. If you apply for coverage and complete the life insurance blood test and urine test, rest assured that you will pay less for this policy than for a comparable policy (if one is) available without medical testing. The lower premium is due to the additional information the insurance company will have from your exam and lab results during underwriting. 12
Chapter 5 Life Insurance Underwriting When you apply for a life insurance policy your file will be reviewed by an underwriter at the insurance company. All insurers have life insurance underwriting guidelines to follow. Each company has slightly different standards. An independent life insurance agent should be generally aware of how each company treats the main underwriting concerns outlined below. During the first review, the underwriter will evaluate your medical history, family medical history, paramedic exam and lab results. 13
Here are some important factors that can affect your rating: Height and weight Your medical conditions Your medications How compliant you are with Doctor orders Parents or siblings who were diagnosed or died of cancer, heart disease, or with some carriers diabetes before the age of 60 Your lifestyle- do you participate in extreme sports? How is your driving record? Do you have a history of alcohol or drug abuse? If the insurance company feels that more information is needed for a decision, they will order records from your physician and/or hospital records. Additionally, you may have to complete a questionnaire, or an interview. It is very important to be honest on your application and any follow up questioning. If the insured dies during the first two years of a policy, the carrier can deny a death claim for fraud found in the application. 14
When the additional information is received, your file will go back to the same underwriter for review. Hopefully the questions are answered fully and underwriting can be completed. Life insurance underwriting can be very complicated. Multiple medical issues can be more difficult to underwrite. What happens if the outcome is not favorable? This is where using an independent life insurance agent can be especially beneficial. As they represent many carriers, they can approach other insurance companies for quotes. In addition, some agents have access to an in-house underwriter who can review the file and assist in placing the case at the proper insurer. The same exam can be used; all that is required is a new application! Important Point: Every company has different underwriting guidelines and an independent agent can get you to the right carrier for the best value. 15
Let Us Know How We Can Help! For more than 20 years, LifeNet Insurance Solutions has helped those in need of life insurance protection to obtain affordable coverage. As agents for most major national insurance companies, our aim is to provide you with the best possible experience. We do this by providing you with Outstanding service Clearly helping to define your objective Suggesting ways to lower your premium Providing you with the knowledge to make an informed purchase We re easy to find Our website: www.lifenetinsurance.com Our phone: 800-698-7033 16 16
Copyright Notice & Legal Notice 2015 LifeNet Insurance Solutions 11505 Eastridge Drive NE Suite 420 Redmond, WA 98053-5758 800-698-7033 Feel free to share this ebook (FOR FREE) with anyone you want to. All rights reserved. While attempts have been made to verify information provided in this publication, neither the author nor the publisher assumes any responsibility for errors, omissions, or contradictory information contained in this document. This document is not intended as legal, accounting or investment advice. The reader of this document assumes all responsibility for the use of these materials and information. For more information call Lenny Robbins 800.698.7033 17