I asked my wife tonight what I should post today, and she talked about the Life Insurance Application Process. She probably thought about this because we decided to change our term life insurance policies yesterday, as the rates went down again. For my age and my wife’s age, along with the face amount of the policy, a policy with I was going to have the cheapest rates. But, since I work with Life Insurance daily and know the carrier’s underwriting guidelines, I knew we wouldn’t qualify for those rates through X and that I would have the lowest rates for our situation.
Like any other client, I completed our applications and ordered the testing requirements. I believe this is part of the process many people don’t understand, so I will focus on it.
The application has typical personal information: Name, address, phone, and gender. And then, it gets more private information like social security number, employer, annual wages, and net worth. You may ask why a life insurance company needs to know such information. We must prove to the life insurance company that you have an insurable risk. Or if you would like it, in layperson’s terms, they want you worth more alive than dead. Some of these rules, laws, and underwriting guidelines came about because of people like Al Capone and his associates. You know it wouldn’t be uncommon for Capone to get a life insurance policy on someone and then…well, you know the rest of the story!!! But I digress. On the application, they are going to ask some health questions. Depending on the type of policy will depend on how many health questions there are, but for our policy, there was a standard page full.
There are a couple of pages of consent; for example, on ours, we had to sign an HIV consent form, which states that they will test us for HIV, and if it comes back optimistic, what doctor did we want them to notify?
The next step, as the agent, I ordered the lab tests to be done. Depending on the policy depends on what if any, lab tests need to be done. On our policy, we need to have a nurse perform a blood test, urine test, and height and weight. The life insurance company will pay for these tests, so you don’t have to worry about paying for them. The company I like using for these tests offers my clients the opportunity to come out to them either at work, at home, or into their office. All these tests are for the company to score you to ensure you are a reasonable risk for them to insure.
Introducing the Underwriter
After all this is complete, the underwriter will review all the tests, apply the company’s underwriting guidelines, and look at the state’s mortality table. At that time, the company will decide whether or not to offer you life insurance at what price and if any stipulations may apply.
As with my and my wife’s policies, I will hold your hand throughout the application process for the life insurance policy. As Your insurance planner, I will be there to answer any questions you may have and to help the underwriters with any questions they may have. I will also be there if you need to change payment methods during the policy if you want to shop around for better rates or change the beneficiary, and any other life insurance maintenance that needs to be done. I will also be there if there is a need to file a life insurance claim. (this is the most critical factor in a life insurance policy, not the price). I have made a few life insurance claims in my career, and while it is a sad time, being able to help the grieving family makes me enjoy my job.
I would love to help you through the life insurance application process. Give us a call today (352) 508-4221