Buy a Life Insurance Tips

While a pre-existing health condition, such as heart disease, high blood pressure, diabetes, cancer, and kidney or liver disease, doesn’t necessarily mean you will be denied life insurance, it can create additional obstacles and slow the application process.

You can keep the delay to a minimum and secure the best rates possible if you know what kind of agent to work with, how to find a carrier that will best suit your needs and what type of policies to consider. Here are seven tips to help simplify the process despite any medical issues in your history.

1. Do your research

Buying life insurance is no fun, so it’s understandable you might want to hurry up and get it over with. But if you have a pre-existing condition, it’s important to be patient, because obtaining high-risk life insurance will likely require more work upfront for both you and your agent.

Make sure you research your options and understand what you need to do and what questions you’ll be asked about your health. Required documents often include prescription information, cover letters explaining your health issues or perhaps more detailed information if your agent wants to get a quote from a carrier.

But before you even talk to an agent, gather as much information regarding your condition as you can. You may need documentation and dates of medical diagnoses or treatments as well as the name, doses and frequency of any medications you take. Having this information handy can reduce the guesswork for your agent so he or she can pair you with a proper carrier.

2. Work with a trustworthy, independent agent

An independent agent can act as a broker and present rates from more than one carrier. Working with an independent agent not only allows you to see all of the policies available to you, but it also replaces the hassle of shopping around and calling many different agents. Independent agents are able to quote multiple companies and transact with them on your behalf. On the flip side, a captive agent works with a single insurance company.

Your independent agent will help guide you to the carrier at which you’ll qualify for the lowest premiums based on past and current health. The agent should be knowledgeable about how best to present your case. This can mean drafting cover letters, seeking preapprovals or even helping you choose between carriers based on medical examination requirements.

Finding a trustworthy agent is a process of elimination. Most people start by getting a referral or searching online for a local broker. However, if you have a medical condition, be sure to look for someone with expertise in that particular condition, or at least an agent who specializes in high-risk policies.

3. Be truthful and upfront about your condition

Be as open as possible when speaking to your agent. Know that he or she is on your side and working on your behalf, but the agent’s actions will be based on the data received from you. Even the best agent can act only on the information you’ve supplied.

Answer every question you can in detail. Having proper dates of diagnoses, treatments and tests can help a lot. Knowing medications, doses and information from previous lab results can aid as well. You should bring to the table anything you can regarding your condition.

4. Get quotes from multiple providers

Utilize your agent’s expertise and ability to shop around for the best policy. The key is to make sure you get quotes from several companies, not just one. This is especially important for high-risk cases, because health impairments may be reviewed differently from one carrier to the next.

When you get your quotes, ask your agent about the insurance companies he or she presents to you in case you’re not familiar with them. You want to choose a company you’re comfortable with. Your agent should also be able to answer any questions or concerns you have with each individual carrier and help you compare them on more than just price.

5. Choose the proper policy type

With health risks, you may be limited in the kinds of life insurance policies you can apply for.

For instance, fully underwritten policies require a complete medical questionnaire, an exam, various background and prescription checks and most likely a physician’s statement, too. However, with some pre-existing conditions, you may not be able to qualify for a fully underwritten policy, so a traditional term life insurance option (covering you for a specific amount of time) would be off the table. In addition, some benefits or riders, like a waiver of premium rider that protects you in case of disability, may not be available to those with certain impaired risks.

A graded benefit life insurance policy requires few health questions and no exams. This would allow someone in moderately poor health to still get life insurance, but the cost would be higher and the payout structure would vary.

A guaranteed acceptance life insurance policy assures you can’t be turned down and has no medical questions or exams. While it sounds great, you’ll be significantly limited by how much coverage you can buy, you’ll pay the highest costs per thousand, and the payout structure, as with a graded policy, may not offer full benefits for three years or more. These policies should be your last resort because of the high costs.

Note that most graded and guaranteed life insurance policies are permanent by default, but some graded types are term policies.