Many people may not know what underwriting is until their insurance agent brings it up. Life insurance underwriting is the process that insurance companies use to determine the financial risk associated with issuing a life insurance policy to cover you. The life insurance companies typically take a look at your life and health profile and try to figure out what category you fit and how much risk you are to cover. Underwriting life insurance may be complicated and there could be questions that arise when a premiums are higher than first quoted or when a company denies you coverage.
Factors to consider
Every insurance company usually has different underwriting life insurance guidelines; but the most common factors in question when your application is sent to the underwriting department and pending approval may be: smoking, cholesterol, blood pressure, build (height and weight), family history of cancer or heart disease, and driving record. Life insurance underwriting departments typically take a look at your application and the answers you provided to the tough questions they ask. They generally run background checks to see what your health is like and make sure you didn’t lie on the application. If you did, they may usually find out the truth, so always stay on the safe side and don’t lie. Want to learn more about passing life insurance underwriting? Visit the article “How Do I Pass Life Insurance Underwriting?”
What this means to you
When you are evaluated by the life insurance underwriting department, you will typically be assigned a rate or health class. They use techniques and statistics to figure out where you fall on the risk scale. The younger and healthier you are, the less likely you may be to die so your coverage and premiums will generally differ if you are older and have some health issues. Basic question is how likely you are to die during the term that you are being covered. If they find out you lied on the application, they may have more reason to suspect you, and they could have a policy that might cover you. With so many companies out there with different underwriting life insurance guidelines, you may be able to find something that works for you.
Don’t think that just because you have one or more of the factors listed above you won’t be approved for insurance or that the premiums will be extremely high. It is true, the premiums could typically be higher but there are affordable rates out there that may cover you. You need to look for the right company with the best life insurance underwriting that will cover you.