Most people are eligible to buy life insurance in some form. Still, the type of policy, level of coverage, and cost depend on several factors unique to each applicant's situation. Your age, overall health, family history, lifestyle habits (such as whether you're a smoker), and other factors help the
life insurance company estimate your life expectancy. The longer your life expectancy, the lower your risk and cost to insure – and vice-versa. Some policies let you skip the medical exam and only ask a few questions about your health; others don't even ask health questions. But that doesn't necessarily mean they're a good deal. Policies that don't ask for health information typically have to charge more per $1,000 of coverage because the insurer must assume the applicant has medical
issues. If you're buying a substantial policy to provide for your family, it generally makes sense to get a "medically underwritten policy" –. If you are in excellent health, you'll pay less for coverage because the insurance company knows that whatever other factors affect your risk, health isn't a problem. In fact, if you have a well-managed medical condition (such as high blood pressure) but are otherwise in good health, it may still make sense to get a medically underwritten policy.
After all, the insurance company has checked your health and doesn't have to assume the worst. Life insurance comes in two primary types — term life insurance and permanent life insurance.
Either type of coverage may require a medical exam, especially if you're getting a large policy. So, say you're relatively young and healthy, and qualifying for coverage won't be an issue. You could get a term policy and save money initially. However, when the term expires, you'll have to apply for new coverage, and rates will be higher because you're older. In the meantime, you could also develop a health condition, such as diabetes or a heart arrhythmia, that further drives up your cost of coverage or maybe even disqualifies you from getting a medically-underwritten policy. Instead, you'd have to apply for a no medical exam policy, but you'll pay even more – if you can get the same amount of coverage. These policies typically have coverage limits. On the other hand, if you get a permanent whole life policy when you're young and healthy, your premiums will never go up or down and will always be based on the health rating you had when you applied. So if you get coverage at age 30, whole life premiums will be higher than they would be for a 20-year term policy. But fast-forward two decades later: if you apply for a new 20-year term policy at age 50, the cost could be almost 4x higher – even if you're in good health. (See for yourself by trying out our life insurance calculator and entering different ages.) But the monthly premiums of a whole life policy will be the same as they were at age 30 – and the protection will last as long as you live. What takes place during the life insurance exam?If the policy you're applying for requires a medical exam, the life insurance company will arrange for it and cover the costs. A representative will usually contact you to schedule your appointment, and the examiner will come to your home or office. The exam usually takes 15 to 45 minutes, depending on what's required. There are typically two parts: a questionnaire and a basic physical exam. Part 1: The QuestionnaireThe policy underwriters (insurance company professionals who assess your risk) will consider both your medical and lifestyle information, so the questionnaire will likely cover the following:
Part 2: The life insurance physical exam
How to prepare for your life insurance examTo help save time filling out your questionnaire, it helps to gather the types of personal information items that will likely be asked for, including:
There's not much you can do to prepare for your medical exam. You can't make significant improvements to your health in a short amount of time, but you can take some steps to ensure the best possible results: The week before your exam:
12-24 Hours before the exam:
Day of exam:
Once your exam is complete, the results go to the company's underwriting team. The underwriting process can take as little as a day or two, but more often, a few weeks. During that time, an underwriter will look over the details of your application, your health information, and your lifestyle to determine your insurance risk class: the larger the policy, the more detailed the underwriting process. Once underwriting is completed, you'll find out if you were approved and at what rate. If you've been working with an experienced agent and no health surprises are uncovered, you're unlikely to have higher premiums than you expected. However, there may be instances where a person is approved for life insurance coverage but not for the total amount due to risk factors uncovered during the underwriting process. How to avoid having a life insurance examAs we've noted, if you're in good health – especially if you're a non-smoker – you're most likely going to pay less for medically-underwritten life insurance that may include a health exam. However, if you have been denied coverage or believe you have a medical condition that would result in denial, there are two kinds of policies that never require a medical exam.
Workplace life insuranceMany companies offer employer-sponsored life insurance plans as an employee benefit. These plans feature affordable group rates and may not require a health exam unless you apply for coverage over a certain limit. If offered by your employer, this could be an excellent choice, especially if you have health issues that limit your ability to purchase other coverage. Explore your optionsIf you're looking to purchase life insurance and want more guidance about how to get a policy that fits your needs at a price you can afford, Guardian can help you find a nearby financial representative who can help guide you to the right solution. Frequently asked questions about life insurance medical examsWhat exam do you take for life insurance?Insurers often require a life insurance medical exam for life insurance policy applicants. It typically consists of two parts: a questionnaire and a physical exam. The examiner will often come to your home or office and perform a short physical examination that includes basic height and weight measurements, a check of your vital signs, including pulse and blood pressure, and taking blood and urine samples. How do you prepare for a life insurance test?There's not much to do to prepare for the life insurance medical exam. However, there will be some questions to answer, so it helps to gather certain information related to your medical history. For the physical exam, it's a good idea to take care of yourself in the week leading up to the exam by eating healthier (avoiding alcohol, increasing water intake, and limiting salt, sugar, fat, and high cholesterol foods), drinking more water, and getting plenty of sleep. Who is included in the underwriting process?An underwriter is a financial expert who takes a look at your finances and assesses how much risk a lender will take on if they decide to give you a loan. More specifically, underwriters evaluate your credit history, assets, the size of the loan you request and how well they anticipate that you can pay back your loan.
What is involved in underwriting insurance?Insurance underwriters use computer software programs to determine whether an applicant should be approved. Insurance underwriters decide whether to provide insurance, and under what terms. They evaluate insurance applications and determine coverage amounts and premiums.
What is the primary responsibility of the underwriting department of a life insurance company?Underwriters are responsible for deciding whether or not to accept applications for insurance cover – this is known as 'risk'. Determining risk is a complex process and the job relies on sensible judgement and meticulous attention to detail.
What are the steps involved in underwriting process?There are broadly two parts to underwriting:. 1) Financial Underwriting. It helps the underwriter to make sure the amount you're purchasing is in line with your family's and your needs.. 2) Medical Underwriting. ... . Step 1: Application Quality Check. ... . Step2: Medical Examination. ... . Step 3: Final Application Rating.. |