The life insurance companies are in business to generate money. Hence, most life insurance companies make an effort to steer clear of high-risk clients. As a result obtaining high-risk life insurance is highly complicated. Life insurance companies use mortality table to determine the premium an individual must pay for his coverage.
Additional factors include gender, age, your overall health and family medical history. They also need to know about risk factors, such as whether you smoke, use illegal drugs or engage in dangerous sports like skydiving, all of which affect your life expectancy. It could also be a high-risk occupation such as oil worker. Nevertheless, the most common high-risk life insurance is a significant health condition such as cancer, diabetes, stroke and more.
High-Risk Life Insurance Categories
Luckily for individuals who are looking for high-risk life insurance, some carriers are okay with accepting high-risk clients. The bad news is that the coverage is costly. Also, these companies can use a limit on how much coverage you could buy. What defines a risk category? Four categories are regarded as high risk. They include:
- Diseases: If you were diagnosed with a serious or terminal disease such as cancer, stroke, diabetes, Alzheimer’s or COPD.
- Hobbies: You may have a safe job during the week, however, if your weekends involve activities such a scuba diving, skydiving or racing cars you’ll probably still be considered high-risk.
- Professions: Several occupations can put you into the higher risk class. High-risk occupations include firefighters, underground miners, and underwater welders.
- Habits: Some of your lifestyle habits will be high risks, such as cigarette smoking, cigars, or chewing tobacco.
What the Underwriter Will Ask
Each high-risk life insurance carrier has its requirements and restrictions for the underwriting process. If you fall into a high-risk category, there are several elements that a life insurance company will take into account concerning the particular risk associated, and this can also vary noticeably from one company to another. Let us look at few examples.
High-Risk Hobbies Such as Skydiving
- How many jumps do you do each year, on average?
- Are you a professional? Do you get paid?
- Do you have any certifications?
High-Risk Profession Such as Pilot
- Total PIC hours.
- Type of license (Commercial, Instructor, Private, etc.)
- Date of Certification with FAA.
High-Risk Habits Such as Smoker
- How many years do you smoke?
- How many cigarettes do you smoke a day?
- Overall health.
High-Risk Illness Such as Diabetes
- How do you manage the condition?
- What is your A1c level?
- How old were you when diagnosed?
High-Risk Conditions We can Insure
- Alcohol Abuse
- Crohn’s Disease
- High Blood Pressure
- High Cholesterol
- Rheumatoid Arthritis
- Sleep Apnea
High-Risk Life Insurance Tips
- Bear in mind, being completely honest with your insurance company when asked questions regarding your health and habits is critical, or else you may risk getting your policy canceled. Life insurance policies are subject to a two-year contestability period during which your life insurance carrier can terminate your coverage or refuse a claim if you are found to have falsified information on your application.
- Shop for the best broker, not a policy. Comparison shop for quotes is crucial. Having said that, searching for the best broker who is an expert in your type of high-risk condition, will guaranty you’ll get the best coverage because they will shop all companies considering your distinct situation.