Does anyone know the real reason I was given a "standard" rate for life insurance?
If anyone works in the insurance industry and can answer my questions I would much appreciate it. I am a 35 year old housewife, never smoked, 5′5, 116 lbs and have excellent levels for cholesterol (155), Tri (54), HDL (40) and so on……I have no family history of health issues nor does my immediate family. Several months ago I went to my doctor for a sleep issue. I was given a prescription for Ambien. I took it for awhile but do not need it anymore, and have not refilled my prescription in two months. I told this information to the insurance company and proceeded to have the blood work and such done. Basically, I have excellent health, however the one issue. Per the underwriter I have insomnia and am considered a risk!!!! I was given a Standard rate at $44.00 per month. I understand insurance companies share medical information, but how long does this info, "Stay on my record", can I get doctors report explaining it was a temporary issue and contest the issue? AND… I was also told the underwriter based my "risk" per my recorded conversation when I was honest and explained the reason for my last doctor visit, I figured they would check, which they have not and have no diagnosis as such. Is this legal? I am not in the medical profession, how is it possible the insurance company labels me because of something I said with no diagnosis to back it up. What is the real issue, other than the obvious….$$$$$$$ ????
The policy was term life for 30 years, at 300 k. I did not speak to the underwriter, I spoke with my insurance agent who relayed the info to me. I also spoke to a rather uneducated phone medical screening employee who, I can only guess made a medical determination on what I told him, and kept asking me to spell out words for him!! All the info I submitted is correct, this is why I am puzzled, and would end up more frustrated if I applied to other companies again and again if I been labeled a so called "risk". I will end up shopping around for more.. Thank you for the advise….
Well, the underwriter gave you the reason THEY are giving you a standard rate. I’d strongly suggest you shop around, using a local agent. A local agent will know which companies would still give you a preferred rate, and every insurance company looks at it a bit differently.
MIB doesn’t purge medical records, so they’re there, FOREVER.
Yes, it is legal.
Another reason, could be if you’ve ever had a c-section birth, or if you’ve given birth in the past three years.
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I’d like to say that the only reason was to get more $$$ out of you but such is definitely not the case. The life insurance business is incredibly competitive with over 3,800 companies looking for your business. None want to charge you any more than they absolutely have to as your risk of dying is almost zero at your age and health.
Now, I do not know what the company conducting the telephone inquiry asked you but insurance companies normally contract that out to one of several companies. Unfortunately, those companies routinely hire 18 year olds with no education, or talent for asking questions, interpreting the answers or recording them. You didn’t get a call from the "underwriter" as they never make those calls, not once, not ever. Underwriters seldom even speak with the writing agent.
Another piece of information that you may find invaluable is that, in cases like yours insurance companies NEVER share information. Only the most serious of undisclosed health conditions get reported, and not to "each other" but to a centralized reporting agency call the MIB (Medical Information Bureau) where it can stay on your record for as long as 9 years). You can look at your MIB report for a small fee (I have done this several times on myself) just to let you know what you absolutely have to disclose on the insurance application.
Re-apply for the insurance. The insomnia and Ambien prescription will not be an issue. If you have no other alternative, apply with one of the largest insurers or through a brokerage that can take a "trial application" and shop the risk to a dozen or so companies. The latter won’t be necessary as you don’t have anything that should cause any company any concern.
Standard rates aren’t the kiss of death. There are about 15 different rates ranging from something most olympic athletes wouldn’t qualify for on up to someone who smokes a ton and has some significant health issues. You get the rate that the individual company’s rating criteria qualifies you for, plain and simple. The next company will probably rate you better than standard non-tobacco unless there’s something missing in this whole equation.
I must say that in my 35 years of selling life insurance there has almost always been something in stories like this that the teller doesn’t disclose. Not saying that you’re lying, just telling you of my experience. Life insurance pricing isn’t a guessing game, it’s almost a science, as is the actuarial criteria that goes into pricing a policy. You only have a certain chance of dying in any given year at any given age considering the underwriting criteria. That chance is the same with all companies. What the premiums are built from on top of that chance are the overhead that it takes to operate that company and the commissions paid to the agent who is selling it. Those vary but the agent isn’t getting paid a lot and almost nothing to service your policy after the first year.
Try again. You’ll be happy you did.
P.S. You didn’t tell us how much insurance you’d applied for. Who knows, that $44 might be a real bargain.
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Well, the underwriter gave you the reason THEY are giving you a standard rate. I’d strongly suggest you shop around, using a local agent. A local agent will know which companies would still give you a preferred rate, and every insurance company looks at it a bit differently.
MIB doesn’t purge medical records, so they’re there, FOREVER.
Yes, it is legal.
Another reason, could be if you’ve ever had a c-section birth, or if you’ve given birth in the past three years.
References :
If you don’t trust the broker you bought from to ask then why did you buy from them? Your broker should be helping you apply to other companies if that’s what you want to do. Just because one company did that doesn’t mean all of them will.
It’s the obvious. Usually to get the ‘best’ rate you can’t be on (or recently on) ANY prescription medication.
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It also depends on the carrier and the way they underwrite their policyholders. What carrier did you use? Perhaps I could give you better insight on what carrier would rate you as less of a risk. Did you use a website to get a policy or an agent? This also can influence underwriters. Often times I get clients of mine with average or worse health history better rates due to past experience working with the carrier or underwriter.
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