There are a variety of reasons why an applicant can be turned down. The leading cause of declination is poor health. Another reason for declination could be substance abuse and/or addiction to drugs or alcohol. Your motor vehicle driving record could contain multiple traffic violations, even DUI. What could be a hobby for some, will be too great a risk for the life insurance company like cliff diving or deep sea scuba. Underwriting may deem that the life insurance can’t be justified on the basis of the proposed beneficiary or that the amount of coverage is not warranted. These are just a few of the possible scenarios that could cause your application for life insurance to be turned down.
There is actually a whole list of why a person can be turned down for life insurance. Life insurance is a risk based product. Meaning an insurance company is willing to "bet" on your mortality and they are very good at it. They will promise you a rate for a given time period they are willing to accept in exchange for a large lump sum face amount paid to your beneficiary.
Because of this risk their underwriters will look at very aspect of your life starting with age, build, occupation, life style, health status, geography, drug use and nicotine use to determine this risk. If any one of the aspects is outside of their risk tolerance then the person is declined for life insurance.
Insurance Adviser - Broker, SC Insurance Services, Oahu, Hawaii
It really depends on the company, but there are a number of parameters that can prevent a person from qualifying for life insurance. There are a number of insurers for example that will insure people up the the age of 90... not very many, but there are a few. Most will not insure people over the age of 80 no matter how good their health is. The mortality tables just place them at the high end of risk for death and therefore not a good investment for the insurance company.
Most health conditions are not complete blocks to getting insurance, but may well be rated and therefore require a higher premium. Most insurers will not insure a convicted felon until they have fulfilled their parole requirements. Even then some companies will not take the risk.
If a person's occupation and or avocation is considered too high a risk, that may cause some insurance companies to decline issuing a policy.
.JPG){kind=avatar}
Because of this risk their underwriters will look at very aspect of your life starting with age, build, occupation, life style, health status, geography, drug use and nicotine use to determine this risk. If any one of the aspects is outside of their risk tolerance then the person is declined for life insurance.
Most health conditions are not complete blocks to getting insurance, but may well be rated and therefore require a higher premium. Most insurers will not insure a convicted felon until they have fulfilled their parole requirements. Even then some companies will not take the risk.
If a person's occupation and or avocation is considered too high a risk, that may cause some insurance companies to decline issuing a policy.