How To Approach Life Insurance Underwriting Approval

By on November 29, 2012

If you are interested in getting a life insurance policy, you may have to deal with underwriting if you would like to get an affordable rate. What life insurance underwriters do is determine whether the life insurance company wants to take a risk on insuring you, and you much your life insurance rates can be.

Before you fill out a life insurance policy, here are some things to know:

How life insurance underwriters work

The underwriters use actuarial tables and statistics with computer programs which help determine life expectancy. The lower the life expectancy, the more you may end up paying.

Generally speaking, your age is one of the things that will determine how much you may pay for life insurance. If you are in your twenties, you will usually pay less for life insurance than you would if you were to sign up for a life insurance policy at age 65. That’s because your life expectancy at 65 is much shorter than in your twenties, which means that it is much more likely that the life insurance company will have to pay out the policy.

Of course, that is one of the things with life insurance underwriting that you cannot change, and if you don’t tell the truth, it can catch up with you. The life insurance company very well could find out, and cancel your policy.

Health also plays an issue

Your life insurance coverage rate is based on a variety of things, and age is one of them. Other things have to do with health. Having heart disease, diabetes, or cancer, to name three things, can lower your life expectancy. So in those cases, you could end up being classified for high risk or impaired risk life insurance. What that means is that you may have to pay higher rates, and might not be able to get as much coverage as if you were in perfect health.

Things like having high blood pressure and high cholesterol can also affect your life insurance rates, as they can lead to health problems. Of course, if you are able to treat these conditions, that might have a positive impact on your rates.

Bad habits and other issues can play an effect

If you smoke, drink to excess, or do drugs, this could also put you in a high-risk category for life insurance. That’s because there are known health problems from such issues.

In addition, some other things can negatively affect your life insurance rates:

  • Your profession: A risky job with a higher death rate can mean paying more for life insurance.
  • Your driving record: If you have a bad driving record, with lots of accidents and speeding tickets, or reckless driving tickets, this could negatively affect you.
  • Your hobbies: If you live to skydive or do other risky activities, it could hurt your chances at getting great life insurance rates.
  • Your weight: If you are overweight or obese, this could be an issue with rates.
  • Your criminal record: If you have one, this could negatively affect your life insurance rates.

Now, there are other things you can do to help affect your life insurance rates. Quit smoking and risky activities, and take care of your health. This could potentially have a positive effect.

One other note: be sure that you always tell the truth on your life insurance application. Even one lie could potentially cost you the policy. Good luck.

Lisa Swan writes for a variety of life insurance sites, including MedLifeInsurance.net.

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