Founder, Abrams Insurance Solutions, Inc., San Diego, CA
To purchase life insurance, you must qualify medically and financially. Every life insurance company has their own guidelines and criteria for qualification. Financially, you must have a certain amount of income or assets to qualify for the amount of insurance that you are purchasing.
When it comes to health underwriting, only the most serious illness are outright denied such as HIV and certain cancers. If the condition is not too serious, the company may offer you coverage, but charge a higher premium. It is important to speak to a knowledgeable advisor who can assess your situation and recommend a company that will provide the most favorable underwriting for your unique situation.
There are a variety of reasons why life insurance would be denied to a potential insured applying for coverage: Medical issues, no financial justification, the recreational activities are too dangerous, there is no insurable interest, the travel destination during the next two years is too dangerous, the driving record is too egregious, drug abuse, vocation hazard , etc. There are reasons that a death claim would be denied like fraud or suicide in the first two years.
In the first two years after the policy has been kept in force there is a contestability period for suicide, misrepresentation and fraud. Keep in mind that certain life insurance company’s death claim due diligence processes may continue after the two year contestability period based on some forms of fraud and criminal activity surrendering the insured’s death. If it feasible that a life insurance company to experience financial problems, fall into receivership of the state (a form of bankruptcy) and affect claims paying ability.
Life insurance is denied when the applicant does not qualify for the policy they applied for. This is also called a decline. Using an experienced agent can greatly reduce your chance of being denied, especially when you have a health condition or other risk factors. Far too many declines happen simply because the applicant was misled or did not read the fine print. Talking to a trusted agent and being upfront with them is your best defense against being denied for life insurance.
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When it comes to health underwriting, only the most serious illness are outright denied such as HIV and certain cancers. If the condition is not too serious, the company may offer you coverage, but charge a higher premium. It is important to speak to a knowledgeable advisor who can assess your situation and recommend a company that will provide the most favorable underwriting for your unique situation.
In the first two years after the policy has been kept in force there is a contestability period for suicide, misrepresentation and fraud. Keep in mind that certain life insurance company’s death claim due diligence processes may continue after the two year contestability period based on some forms of fraud and criminal activity surrendering the insured’s death. If it feasible that a life insurance company to experience financial problems, fall into receivership of the state (a form of bankruptcy) and affect claims paying ability.