Do you qualify for life insurance? Insurability comes with a lot of misconceptions. One of the common reasons people overlook insurance as an investment tool is the assumption that they aren’t eligible due to a medical condition, lifestyle factors, or previous denial of coverage.
There are many factors that determine whether or not you are insurable. Underwriting standards (the process of determining if you qualify for life insurance and how much your premium will be) vary between insurance companies. At Paradigm Life, our Wealth Strategists work with a variety of top-rated mutual insurance companies to find a policy to fit your lifestyle and financial goals.
What do you need to do to qualify for life insurance?
Write down your goals
Before you consider any type of insurance, know why you’re purchasing it. What you want to achieve with your policy. Are you using insurance as an investment tool to grow your wealth? Are you looking for more income in retirement? Are you simply trying to protect your family against the unexpected? Write down your top three financial goals, then determine what you need to do to qualify for life insurance products that will help you achieve your desired outcomes.
Determine what type of insurance you need
Term Life Insurance
If you’re paying off a temporary expense, like college tuition or a mortgage, for which your family would be significantly affected should you unexpectedly pass away, term life insurance might be the way to go. Premiums are typically lower than whole life, but so are the benefits. Term life insurance doesn’t offer a living benefit. It will only protect your family with a death benefit if you pass away within the specified time frame of your policy.
Whole Life Insurance
As an investment tool, a dividend-paying whole life insurance policy is the safest way to grow your wealth. Compared to other investment options, whole life gives you control over your money, increases liquidity, and can improve cash flow. Mutual life insurance companies have a historically consistent record of paying out dividends on policies and the cash value of your policy earns interest, even if you take a policy loan against it. Whole life insurance offers both living benefits and a death benefit.
For help determining which type of insurance is right for you, schedule a free consultation with a Wealth Strategist.
Collect your application information
Regardless of the type of insurance you choose, an application is required. The application may ask questions about the following:
- Date of birth
- Employment information
- Financial information
- Medical history for you and your family
- Existing life insurance policies
- Lifestyle habits that influence your risk
- High-risk hobbies
- Drinking habits
- Recreational drug use
- Travel frequency
Talk to your doctor
Whether or not you need a medical exam as part of your policy application is most often determined by your age and the amount of your policy. Talk to your doctor before applying for life insurance to discuss what steps you can take now to improve your medical exam results.
If you’re required to take a medical exam, our team at Paradigm Life will help you schedule your exam. We’ll also help you take care of any additional tests and/or paperwork.
Improve your driving
As part of their due diligence, your insurance company’s underwriting team will check your driving record. The safer you are when driving, the more likely you are to qualify for life insurance and receive an affordable premium.
Skip happy hour
Your insurance company’s underwriting team will assess your alcohol intake to determine if it poses a risk to your health, which affects your insurability. Excessive drinking, particularly if it you’ve had any driving violations while under the influence, will affect your insurability and your premiums.
Smoking can drastically affect your life expectancy and makes you significantly more expensive to insure. The longer it’s been since you’ve smoked, the better your premium is likely to be.
Being overweight takes a toll on your health because it increases your risk for a variety of diseases, impacts your blood pressure, and can contribute to higher cholesterol. Eating healthy and getting regular exercise will benefit your ability to qualify for insurance.
Consider a rider
A rider is an additional type of insurance you that can be added to a policy. Some riders, like paid-up additions, increase the cash value of your policy quicker. Other riders, like guaranteed insurability, allow you to purchase additional insurance at your current rate, regardless of future changes to your health.
Don’t put off applying for life insurance
Assuming your health and lifestyle don’t currently pose any barriers to insurability, schedule an appointment for a free life insurance consultation today. Taking advantage of your good health and age now will get you the best premium rate.
If you’ve been turned down due to a medical condition or lifestyle factor in the past, don’t be afraid to reapply. Changes in your condition and lifestyle may improve your eligibility to qualify for life insurance.
Don’t give up if you haven’t been able to qualify for life insurance. One of the smartest and most helpful things you can do is speak with a Wealth Strategist. At Paradigm Life, we can shop around for you to find an insurance company that will provide you with coverage. Our Wealth Strategists are experts at finding insurance solutions that work to grow and protect your wealth.