Have you received a rating on your life insurance policy? Or do you expect to receive a rating on your application? In this article I’ll show you how to minimize the possibility of a rating, and your options should you receive one.

Before you start an application

If you have a high risk hobby, activity, or a medical or other condition that you believe may incur a rating, you should discuss this with us prior to doing a formal application. We may, based on our experience direct you to other alternative life insurance choices or to specific companies that may treat your situation with a lower premium. For example, some companies are more lenient on weight. Other companies are extremely rigid with their underwriting and you’ll be wasting your time even applying there. Yet other companies do well with people with heart conditions. In these cases, going with the right company upfront will be easier than just applying to the least expensive company and then experiencing difficulties later.

If we can’t provide an experienced opinion on your situation, we will take some details from you and run them past an underwriter for an estimate. This will give us a reasonable idea of what you should expect, should you apply. You can then make your decision based on this information.

Provide lots of information during your medical examples

This article talks about how to take a medical examhow to take a medical exam. The information in that article is very important for those who expect to receive a rating, as the more information you can provide during the application process, the greater the underwriter’s ability is to offer lower premiums.

If we think you’ll be highly rated or declined

If we expect that you’ll be rated or declined, we will likely suggest that you apply instead for a simplified issue life insurance policy. These policies have a higher premium than a standard life insurance policy (but may be less expensive than a rated policy), and may have some restrictions on benefits – we will explain all of these to you should we suggest you apply to a simplified issue policy.

Simplified issue policies are intended for Canadians who are likely to be declined or highly rated in a typical life insurance policy. They consist simply of a series of yes/no questions (that we have in hand ahead of time). If you answer all the questions no, then you qualify for the coverage. We assess your condition against the list of questions ahead of time, so we know if you’ll qualify or not. 
While these policies are ‘easy’ to apply for, we don’t recommend these for most consumers due to the higher premiums and potentially limited benefits.

If you’ve been rated or declined elsewhere

It’s unlikely that you’ll receive a surprise rating or decline with us, as per the above information, we try to investigate options before you apply – there’s rarely surprises for our clients. However, if you’ve received a rating elsewhere and don’t know where to apply we suggest:
1) always accept the policy. Get it in force just in case it’s the best possible opportunity.
2) Contact us. We’ll provide an assessment and may consider doing a secondary application to one or more companies. Generally this does not require a second medical exam, the companies can pull your data from your original application. Once we’ve shopped it out and have offers from other companies, if there’s a better choice then you can accept it and cancel the original policy.

If you’ve been offered a rated policy without having any preliminary analysis done as described above, or without being offered to shop this to other companies, feel welcome to contact The Term Guy for a second opinion. In all cases, you should accept your offered policy immediately, then let us seek alternative resolutions with an inforce policy as backup.