The cost of your life insurance premiums is determined by several factors, including your age and health. Typically, the younger and healthier you are, the lower your prices, while certain pre-existing medical conditions, such as high blood pressure, high cholesterol, obesity, and depression, are likely to drive up the price. Premiums and, if they are severe enough, can be completely excluded from coverage.
However, health issues don’t necessarily mean that you can’t get competitive prices. Each life insurance company rates each illness differently in its underwriting process. Therefore, it is important to find an insurer that offers the best rates.
A pre-existing medical condition is a medical diagnosis that you have when you purchase life insurance. One in two Americans has a pre-existing condition that could affect their costs or their insurance eligibility. This is the result of a study conducted by the Centers for Medicare & Medicaid Services.
Any health problem you have after activating your life insurance policy cannot affect the cost of your premiums and is not considered a pre-existing problem by insurers.
Insurers collect information about your current health, lifestyle, family health history, and more from the initial phone interview and previous medical exam and/or life insurance medical records. The information they collect about you is used to assign a health rating, which determines the type of rates they offer you.
There are certain pre-existing medical conditions, red flags in your family history, or lifestyle choices that can cause you to lower a score (which in turn increases your rates) by indicating that you are at increased risk of death while your policy is active.
There are several types of pre-existing health problems that life insurance companies consider in the underwriting process, including:
However, insurers don’t just assign a general classification based on health problems. How life insurance companies buy a pre-existing medical condition will depend on the severity of your diagnosis and your treatment plan.
Does that mean that you will be denied life insurance coverage or that you will receive astronomical premiums if you have a pre-existing condition? No way. Each insurance company has different underwriting guidelines and standards for evaluating these and other medical conditions. Depending on your treatment plan and the insurer with which you are insured, it is very possible to find a life insurance company that covers pre-existing conditions and offers you affordable premiums.
For example, one insurer might offer better rates to people with a family history of cancer, while another might treat a condition like high cholesterol more cheaply. For this reason, it is important to compare rates between different insurers, especially if you are concerned about the impact of your health on your insurance coverage.
Finding and buying life insurance can be overwhelming, even for those in good health. There are dozens of insurance companies to choose from, and insurance terminology is not always easy to understand.
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