Underwriting

Fully Underwritten Life Insurance

TermLifeInsurance.com offers fully underwritten term life insurance policies so you can find the plan that meets your specific needs with the lowest possible premiums. The process of underwriting involves evaluating medical and non-medical information about an applicant in order to determine their risk. Proper risk assessment is needed to offer applicants appropriate rates, which is essential to the financial stability of the insurer. This is key to ensuring benefits will be honored in the future for generation to come.

Five Steps of Underwritten Policies

There are essentially five steps to a fully underwritten term life insurance policy. You start with completing the application and medical exam. Then, the information is reviewed by an underwriter and your risk classification is established. Lastly, you will receive a quote for a premium, which you can accept or decline.

1. Application

You can apply for coverage directly on our website. Simply enter your basic information so you can view live rates. Choose the option that is best for you and you can apply online. This only takes a few minutes.

Be sure to answer the questions as accurately and honestly as possible. Misrepresentation of your medical history in order to gain a cheaper premium can backfire on you. Insurance companies investigate your medical history by reviewing your medical exam results and inquiries to the Medical Information Bureau (MIB). The MIB is a clearinghouse of medical information for all insurance companies.

2. Medical Examination

The medical exam is scheduled, completed, and the information is sent to underwriting. The exam is usually given by para-medicals that are licensed health professionals. They are typically independent contractors hired by the insurance company. A basic examination consists of a physical exam, blood work and urine specimen. For higher amounts of coverage, more extensive tests may be performed. This can include a treadmill test, EKG, and X-ray.

There are a few simple things you can do to increase the likelihood of having a more favorable exam, which are as follows:

  • Have a good night’s sleep and drink plenty of water the day before your exam
  • Fast for at least eight hours prior to the exam
  • Do not have any nicotine for at least one hour before the exam
  • Do not have any caffeine before the exam
  • Do not have any alcoholic beverages for at least 36 hours before the exam
  • Limit salt and high-cholesterol foods in your diet for at least 24 hours prior to the exam
  • Do not engage in any strenuous physical activities within 24 hours of your exam

Making healthy lifestyle choices on a daily basis can improve your overall well being. A nice perk is that these healthy choices can also lower your premiums.

3. Medical Underwriting

Each insurer sets the standards of their classifications. Life insurance applicants are grouped together into certain risk classes and then charged premiums based on the risk they pose. The higher the risk, the higher the premiums. Essentially, the insurance company needs to find out if you have any health conditions or make any lifestyle choices that could end your life prematurely, thus effecting the company’s risk of paying out a death benefit. Medical underwriting assesses this risk.

It is the underwriter’s job to review your application and medical information to determine which risk class you qualify for. The underwriter may request additional tests if they deem them necessary to complete the evaluation. The blood and urine samples given are used to test for the presence of specific health ailments or illnesses. The blood samples test for cholesterol and related lipids, diabetes, prostate specific antigens, liver and kidney disorders, immune disorders, hepatitis, and the presence of antibodies or antigens to the HIV virus. The urine sample tests for nicotine use, certain medications, and drugs.

4. Risk Classification

Each insurance company uses their own criteria when evaluating an applicant’s information. You would generally fall into one of the following categories: preferred plus, preferred, standard plus, or standard. There is a large amount of qualifying criteria for each category, so it is important to shop around to find the best rate. Depending on how a company rates certain risk factors, you could qualify for “preferred plus” by one company but only rate as “preferred” by another. This classification can have a heavy impact on your premiums.

Preferred Plus

The cheapest rates will be found for those who fall into the preferred plus category. In order to qualify, you must meet the most stringent health and lifestyle standards. Approximately 21% of applicants meet these specifications, which are generally as follows:

  • Excellent history of health
  • No family history of certain types of cancers prior to the age of 60 and no family history of cardiovascular disease
  • No serious ailments or chronic illnesses
  • exhibits a healthy weight/height ratio, including a Body Mass Index (BMI) of around 25 or less
  • Average blood pressure reading of 140/85 or less
  • An ideal low-density lipoprotein/high-density lipoprotein (LDL/HDL) ratio of 5.0 or less and LDL cholesterol level that is less than 220
  • No tobacco use or nicotine free for more than five years
  • Never received treatment for alcohol or drug abuse
  • A clean driving record that has no more than two moving violations in the past three years, and no reckless driving, DWI or DUI convictions in the last five years
  • No high-risk activities such as bungee jumping, rock climbing, base jumping, sky diving, hang gliding, etc.
  • No high-risk occupational activities like private pilot, mining, commercial fishing, logging or offshore drilling
  • No recent bankruptcies and excellent financial standing

Preferred

The preferred category is slightly less rigid but applicants can still enjoy excellent rates. In order to qualify, your LDL cholesterol should be approximately 260 with a LDL/HDL ratio of 5.5. Your elevated blood pressure should be around 145/90 or less. About 48% of applicants are accepted at this level.

Standard Plus

For standard plus, your LDL cholesterol can be at a level of 270 with LDL/HDL ratio of 6.5 and your elevated blood pressure should be 150/92 or less. Around 27% of applicants fall into the standard plus or standard categories.

Standard

To qualify at the standard level, your LDL cholesterol levels can be 300 with a LDL/HDL ratio of 7.9 and your elevated blood pressure can be 150/95 or less. Asthma, depression and other common ailments are acceptable in the standard category.

5. Premium Quote

Once a classification is determined, the underwriter will quote a premium amount that the insurance company will require in order to provide coverage. You can choose to accept or decline this offer.

If a medical issue or lifestyle concern is found, you could be offered a rated or sub-standard premium. This means you are not declined by the company but they are requiring a higher premium for the coverage. In this case, there are two types of risk ratings on top of the general risk classification. These are table ratings and flat extras.

Table Ratings

Table ratings are an extra charge for applicants with health issues that are charged in addition to the standard rate that applies to applicants without such health concerns. The majority of insurers have their table ratings equal to 25% of standard rates. For instance, a table 2 (or table B) rating will add 50% to a standard rate or a table 6 (or table F) rating will add 150% to a standard rate.

How the table rating is determined depends on the severity of your health issue and how the insurer rates that issue. Since each company has their own unique underwriting guidelines, the additional cost of coverage depends on the company. So, it is advisable to shop around if you have a health concern that could qualify for table ratings. Some companies offer more competitive rates than others.

Flat Extras

The flat extra method charges an extra amount in premium payments per amount of coverage depending on the reason for the additional charge. For instance, an extra $1 could be charge for each $1,000 worth of coverage. This charge can be permanent or temporary. They are typically applied when an applicant has a hazardous job, dangerous hobby or are recovering from a major health episode or surgery.

Process of Obtaining a Policy with TermLifeInsurance.com

The process of obtaining a medically underwritten term life insurance policy with our site is easy and streamlined. Live rates can be instantly viewed without any personally identifiable information. So, before completing a medical exam, you can enter your general health and lifestyle information to see what life insurance companies will offer you the best rates. Here’s how you can view live rates and fill out an application in just three easy steps.

1. Fill Out a Short Form

No personally identifiable information is required, such as your name, phone number or email address. This is not necessary because TermLifeInsurance.com does not sell your contact information to multiple agents who want to bombard you will high pressure sales calls. Just enter basic stats, like your age, gender, height, weight and your general health. Then, you can anonymously view live rates.

2. Compare Live Rates

Instantly, you will be able to compare live rates in an easy-to-read chart. You can look at insurers side-by-side to determine who will offer you the lowest rates and the best benefits. You can also see the A.M. Best rating of each company. This allows you to quickly and easily decide which option is right for you and your loved ones.

3. Apply for Coverage Online

Having this pertinent information displayed in a simple chart allows you to easily choose the provider that is best for your family. Just click on the option you are interested in and you can apply instantly. Our online application is short and simple to complete.




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