Sometimes when clients qualify for life insurance, they might not be in the best health. They might be carrying a little holiday weight from the year (of three years) before, or they might be getting their blood pressure or diabetes under control. It could’ve been that the client was smoking at the time and received a nicotine or tobacco rating. There could’ve been a death in the family that led the client to be on some anxiety or depression medications for a while.
The good news about life insurance is that insurance companies allow you to retest and lower your rating to improve your premiums. The process might take some time, but it could save you hundreds, if not thousands, of dollars. In order to save money, you need to know how it works.
How do insurance companies decide on my health rating?
Insurance companies determine your rating based on the likelihood of you living a long or short life. This is the easiest way to say it. They look at your health, age, and lifestyle to determine if you are living a healthy life or one that brings the risk of a shorter life.
Insurance companies don’t ONLY accept the healthiest people. They have to be aggressive. They have to try and attract as many clients as possible and have competitive rates. They also don’t want to offer life insurance to people who will die soon. If they do so, they can lose a lot of money. So they need to be aggressive enough to win your business but conservative enough to stay in business.
So they have different factors and qualifications to determine whether you qualify for insurance and at what rate. The process is different for each insurance company and policy, but the process could include the following:
An application with a medical questionnaire
A blood and urine exam
Height, weight, and blood pressure readings
Medical records to check on any pre-existing conditions
Your prescription history
Your motor vehicle report
Maybe other reports
Your age, health history, type of coverage, and how much coverage you are applying for can determine what tests or information they need for qualification. Keep in mind that all of these reports or tests cost the insurance company money. They want to do as few tests and reports as possible to make an offer. Paying for reports and tests and then making crazy expensive offers does not help the insurance company. If they don’t win your business, they lose money. So they try to make the best, most aggressive offer possible with the fewest requirements possible.
During this process, it is very advantageous to have an agent. They can help you with all of this and make it a lot easier for you. They don’t cost you any additional money, and they drastically minimize the work you have to do. You can read more about having an agent here.
I have my rating; now what?
The insurance company will make an offer when it receives all the necessary information. You can read about the different offers on this page. This offer determines your premium. The better the rating, the lower the premiums. The lower the rating, the more expensive the premiums.
Keep in mind they know that many clients shop their offers, so they are trying to be aggressive and win your business. When the client is comfortable with the offer, they accept the policy and place it in force. Each month the covered insured pays a premium to keep the coverage in force for a guaranteed period.
Let's skip to the good part.
Here is the information the insurance company does not want you to know. That rating is guaranteed and locked in. However, you can improve your rating. That's right!! You can make it better if your health improves. But if your health gets worse, your rating can not get any worse. It can only go up; it can not go down.
It is a process, and it can take time. But as mentioned above, if you can improve your offer, you can save hundreds to thousands of dollars in premiums. Your health needs to have improved. You can’t just stay the same. So if you lost weight or got your diabetes under control, you can get a better rating and save money. If you have stopped smoking since you purchased your insurance policy, you can get a better rating and save money. You can retest and save money if you have improved your cholesterol, high blood pressure, or diabetes.
The lowering of your rating is not always guaranteed. For example, if you have improved your weight but have started smoking cigarettes, it would not be beneficial to retest. The tobacco rating is going to be a lot higher than your rating for height and weight. If you currently have a life insurance policy and feel you might be able to lower your rating, it is essential that you contact us. We work with all major insurance companies and can help you reduce that rating. You can schedule a free 10-minute consultation here to speak with an Aultium Insurance Agent. This is free, and there is no obligation. It can only save you money to try and lower your rating. It doesn't matter which insurance company you have now; we can help you reduce your rating. We have access to all the major insurance companies on the market. Contact us today and let us save you money.