9 Ways to Get Life Insurance Rates Like Superman

Aaron Crowe | Health, Life Insurance | 23 Sep, 2014 | No Comments

USA Superman postage stampIf Superman or Wonder Woman had life insurance, they’d easily qualify for preferred rates. They’d likely get ultra-preferred rates, meaning they have everything under control.

But for us mortal humans, trying to get healthy and doing other things to get the best life insurance rates can make us feel not so super.

Getting preferred rates isn’t impossible, but it takes some work. You don’t need to be as healthy as a superhero, or even a professional athlete, to get preferred rates, but being healthy does make you a good risk for insurers. For standard rates, being a little unhealthy is OK, though you may pay 15-20 percent more than a preferred rate customer. It can be a lot more for smokers, for example.

A 35-year-old man seeking a $500,000 term life insurance policy for 30 years will pay $54 a month for the preferred, non-tobacco rate, while the standard non-tobacco rate is $74 for the same policy, says Jeff Wald, a life insurance agent at Shelter Insurance, a Midwest-based company that’s in 14 states. For the same man to receive ultra-preferred rates of $40 a month, he’d need to have excellent health, Wald says.

But let’s focus on preferred rates. To get those, you want to be in good health. If you’re not, you can get healthier and then apply for life insurance, though hearing from your doctor that you should improve your health is likely be be a better motivator than your insurance agent.

“A lot of times just life insurance isn’t going to be enough to get people to make a change,” Wald says.

So go see your doctor and get their opinion. Until then, here are nine areas to consider when trying to get preferred instead of standard life insurance rates. Note that every carrier has different methods of determining rates, so not all of these may be considered by your insurer:

Overall health: To have the best shot of getting preferred rates, have great blood pressure, low cholesterol levels and be in overall good health, says Ellen Davis, president of Life Health Home Insurance Group. Other health concerns should also be addressed, which we’ll get to soon, but the best advice may be do do everything in moderation.

Instead of eating dessert every night, eat it first as a treat once in awhile. Start exercise by walking every day. Eat plenty of vegetables, fruit and other healthy foods. If you have to take medicine to keep your blood pressure under control, take it.

Lose weight: If your body mass index, or BMI, is in line with what it should be, then you’re more likely to get preferred life insurance rates. Your height and weight should be in good proportion, and a doctor can help you determine if you’re overweight and the best ways to lose weight.

“In some cases, consumers can find substantial savings by losing just a few pounds before taking their medical exam for a life insurance application,” says Christopher Huntley, co-founder of JRC Insurance Group.

For example, a 50-year-old man who doesn’t use tobacco, is 6-feet-2-inches, 230 pounds and applies for a 20-year term, $500,000 policy with Pruco Life Insurance could get the best rate at his weight at $1,560 per year, Huntley says. If he dropped just five pounds, he’d qualify for a better health classification and would pay $985 per year — a 37% savings, Huntley says.

“Make sure you speak with an agent about your health so you know where you fall into the insurance carriers’ guidelines, and whether it makes sense to attempt to lose weight or improve your health prior to your exam,” he says. “In some cases, it doesn’t. For example, if you need to lose more than 10 pounds to qualify for a better rate, the insurance carrier will only give you credit for half of your weight loss.”

Don’t smoke: Smoking can triple your life insurance rates. Smoking is almost guaranteed to kill you eventually if you continue doing it, and since insurers are looking for customers who don’t have unhealthy habits, this is one of the most unhealthiest.

Drink less: Drinking one glass of wine with dinner — not five — is more likely to get you better insurance rates, Davis says. A health exam will help determine if you’re an alcoholic, but insurers also rely on applicants being truthful and admitting how many drinks they have in a week, for example.

Drinking a lot of liquor is worse than an occasional beer or glass of wine, says Don Chamberlin, a certified financial educator and founder of The Chamberlin Group, a holistic financial advisory firm in St. Louis.

In looking at an applicant’s habits, insurers used to just ask about drinking habits, Chamberlin says. Now they want more details and want clients with a healthy lifestyle who does things in moderation, he says.

Don’t travel to dangerous countries: Whether it’s a travel warning for a country in a civil war or a travel alert for Ebola in parts of West Africa, the countries suggested by the U.S. Department of State to avoid should be taken seriously when telling an insurer that you travel often to dangerous countries for business.

Drop your dangerous hobbies: It may be OK for Superman to fly in the sky, but you shouldn’t. Pilots, hang-gliders and sky-divers can have higher life insurance rates because they have a higher likelihood of dying, Davis says. Scuba diving is also a dangerous hobby that insurers consider, even if you only do it a few times a year.

Check your family history: This isn’t an area you can do anything about, but knowing your family’s medical history can save you time. This is where using an agent can help you gain a little wiggle room, Davis says.

“Always work with a life insurance broker who is willing to do the leg work to find you  the best plan to meet your needs at the best rate,” she says. “Someone who will make the calls to find out from the underwriters if a certain medication or family history will be underwritten favorably.”

Be young: The older you are, the more life insurance costs. It’s a simple fact, and can make buying insurance in your 20s seem like a deal of a lifetime. Purchasing life insurance before age 50 is the best time to get lower rates.

“One of the easiest ways to get preferred rates is to buy life insurance when you are young and healthy, Davis says. “Sounds like a cliché but it’s true, when you are young and healthy insurance carriers view you as a low risk so they will offer low rates.”

Gender: Women usually get better life insurance rates than men because they often outlive men.

Aaron Crowe is a freelance writer who specializes in personal finance topics including insurance, real estate and kids and money. Follow him on Twitter @AaronCrowe or find him on his website, AaronCrowe.net.

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