Substandard Impaired Risk Life Insurance Underwriting Manual

By | January 30, 2009

Impaired Risk and Substandard Life Insurance is an industry term that indicates the insured has health, lifestyle or recreation issues that preclude them from obtaining the best rate classes. Life Insurance carriers each have their own rate classes where likely insureds would be classified in and that is how the premiums are calculated. What this means to you is that if you get classified as preferred plus or preferred rates you are issued cheaper premiums that someone who is substandard or standard rates.

When the underwriters come back with a substandard offer, they are saying currently your health does not qualify for standard rates or better due to health issues. But just because one carrier might say you are a Table 2 or higher does not mean another carrier might offer you better rates.

This is why it is so important to work with a broker that is specializes in these types of cases. Locating the right agent that works with a brokerage general agency will be a great advantage to you in your search for inexpensive insurance. It’s not to difficult to find a good agent, use the Internet to start with and type in substandard life agency or broker. Or try Impaired Risk life insurance also, impaired risk is another industry name used more by the broker and brokerage to identify the type of case.

Just a few years ago there were some life companies that did focus on substandard life insurance risks. Today that really isn’t the case, some carriers do better than others. Remember a big part of your success is to work with and agency that has access to a multi carrier brokerage platform to shop your particular case. Underwriters these days look at the complete file of the insured You get debits for whatever health issues you have but then you might get credits for having good control of blood pressure or your weight. So you probably now see how important it is to work with a multi carrier general agency so they can shop your specific case to the different carriers.

One of the most common types of substandard underwriting issues is diabetes life insurance. Control and compliance of the diabetes is what the underwriters are looking for with this type of impaired risk issue. Cancer probably is one of the most common types of substandard impaired risk issues, in which the underwriters will want to see a evidence of remission and no re occurrence. Give your agent as much information as you can right up from, it will only help go through underwriting much quicker.

If you are a smoker and have other health issues combined this will not help make your case in the eye of the underwriters. If you do smoke and have no other health issue you may be surprised how affordable your premiums could be. So if you smoke don’t let that deter you from getting a free quote from your agent.

Important do not forget to tell your broker to do a substandard life insurance quick quote with the life underwriter that they work with. How this works is you simply give detailed information to your broker about your condition or avocation. They will then send it to the underwriters preliminarily for a review and quote base off the information provided. How this helps you is that you can get some numbers up front that are pretty close to what a formal offer would be depending upon formal application and exams.

The quotes from the carrier in most cases can and should give you a firm idea of what your policy may cost. This strategy is all done informal so you still will have to go through complete underwriting for a formal offer. The quick quote method is a huge time saver and helps you in getting a general idea of how much your new life insurance policy may cost.

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