The first thing you need to do when you get declined for life insurance is to have the agent you’re dealing through find out the exact reason you were declined. The agent should do this automatically, but I suspect that many don’t.
Being told that you were declined because you have diabetes, heart disease, a stroke, or whatever your specific health issue happens to be is not an adequate answer and you must get more specifics.
Make sure you also get a copy of the lab results from your free insurance exam as these results can often provide enough information to determine why you were declined.
You Need To Know EXACT Reason for Decline
For example, if you have diabetes, you’ll need to find out if your diabetes is uncontrolled, what your A1C was, if you’ve had diabetic complications according to your medical records, if your weight is too high, if you have abnormal kidney functions, and if you have blood or protein in your urine.
If you have heart disease or coronary artery disease, did the insurance company feel that you have significant heart damage after heart attack? What is your ejection fraction? Was there evidence of other blockages that were not large enough to treat during initial incident based on cardiac catheterization report? Did you have an abnormal stress test since treatment? Have you had chest pain since treatment? Do you still use tobacco after cardiac treatment? These questions are types of things that can result in you being declined.
If you have any debilitation or paralysis caused by the stroke, problems with memory, or any history of blood clots in your legs or anywhere else in your body, these issues can be a problem for many insurance companies and can preclude you from qualifying with many insurance companies.
The above are the types of things your agent should let you know about if you do get declined, but if they do not provide this information to you automatically, you will need to request it if you intend to still try to get coverage!
Do You Know What’s In Your Medical Records?
I’ve found that many people don’t know what information is really in their medical records. Your doctor may tell you that you’re doing well, but your A1C is 9.5 or your ejection fraction is 40%. These are the types of things that will cause most insurance companies to decline.
I often hear, “My doctor says I’m doing great, so why was I declined?” Doctors are great, and we’d all be in trouble without them, but you have to remember that your doctor is not a life insurance underwriter and probably has no idea of the types of things that life insurance companies consider during the underwriting process.
Some life insurance company underwriters will make it hard for your agent to get specific medical information as to why you were declined because of “HIPAA privacy guidelines.” If you are told this, just sign a HIPAA authorization provided by your agent, so your agent can legally get specific health related details about why you were declined.
If your agent still tells you they cannot get you specifics as to why you were declined, just cut your losses and fire your agent, as they won’t be able to help you.
Even if ANY agent tells you that you won’t qualify with any life insurance companies, this is rarely accurate because most agents can only offer you life insurance from a limited amount of insurance companies.
Biggest Lie: “Since One Company Declined, They All Will”
Keep in mind that there are about 1,000 different insurance companies that offer life insurance in the U.S., and there are more and more companies that specialize in insuring people with health issues. The odds are in your favor that at least a few companies will offer you coverage.
It’s also a myth that once you’re declined for life insurance you will always have trouble qualifying. I’ve had many people contact me and tell me they’re really concerned that they’ve been declined and that it is now part of their “insurance record.” It is better to never be declined because that will show up on MIB for 7 years, but being declined is not the end of the world, though many people seem to think it is.
Being declined by one or more insurance companies does not mean that all other insurance companies will decline you. As an absolute last resort, there are always guaranteed acceptance or guaranteed issue life insurance product available for which anyone who is breathing can qualify.
You need to find a good impaired risk broker or agent that has a lot of experience in getting insurance for people with health issues and can offer you coverage from hundred’s of different insurance companies.
I know firsthand that it’s a hassle to get licensed to do business with lots and lots of insurance companies because there are fees involved for each state I do business in and lots of forms to complete. I know that if I really want to do what’s best for my clients with health issues, I have to find these niche insurance companies that are good for specific ailments and get licensed with them.
In a perfect world, I’d only need to be licensed with 10 or 20 insurance companies and my working life would be so much easier, but a perfect world this is not.
Any Good Agent Will Automatically “Re-Shop” Your Case After A Decline
A good impaired risk insurance agent will automatically offer you alternative life insurance rates after you’re declined.
After gathering your health information, a good agent or broker who is working in your best interest will always look for the absolute best rates and products available to you first. While there is never any guarantee that you will qualify for a specific rate, if there is a possibility, then it makes sense to try for best possible offers first.
On tougher cases, I prefer to have my clients apply to the two most probable, best insurance companies for them since there is never any guarantee of the rate for which anyone will qualify until they go through the underwriting process. This strategy has paid off for my clients so many times that I’ve lost count.
Only one free insurance exam is required even if you were to apply to more than one insurance company. After you have your free insurance exam, ANY other life insurance companies will accept that same exam later. You won’t have to get examined more than once. Most exams and lab results from the exam are good for 6 – 12 months.
Make Sure Your Agent Has Access To Your Medical Records
MANY agents will NOT have access to your medical records and they’ll leave this up to the insurance company to obtain them.
DO NOT do business with any agent that will not obtain your medical records if you have significant issues that could result in you be declined!!
If you have been declined for life insurance in past, make sure that any new agent you decide to use will able to easily send your medical records and your insurance exam results to other insurance companies later, if necessary.
This way if you happened to get declined again, it will be easy for your agent to get offers from other insurance companies.
If none of the “regular” life insurance companies with decent rates will make you a good offer, there are “high risk” insurance companies that can be used as a last resort.
These high risk companies offer simplified issue policies that require limited health information or, as an absolute last resort, you could apply for the guaranteed acceptance or guaranteed issue life insurance mentioned above.
I’ve said this hundreds of times in my career and I have to say it again, almost everyone even with the most serious health issues is insurable for life insurance. You may not be wiling to pay what it will cost you to get life insurance, but you are insurable!
What Makes You Uninsurable for Life Insurance
While we have been able to insure many of the “uninsurable” in the past, there are some issues which will cause 99% of all life insurance companies to automatically decline.
Even though there are more insurance companies that tend to specialize in insuring certain ailments and can make significantly better offers in their niche compared to other insurance companies, some issues are really tough to insure with the “regular” insurance companies.
While there are possible exceptions that can be made, below is a list of ailments for which almost every life insurance company with even semi-decent rates will decline:
- Diabetics with kidney disease
- Diabetics with HbA1C of 10.0 or higher
- Anyone on dialysis
- Anyone with implanted defibrillator
- Any suicide attempts within recent past
- Mention of recent thoughts of suicide in medical records
- Treatment for alcohol or other substance abuse within past 2 years
- Anyone with active Hepatitis C that still consumes alcohol
- Any diagnosis of Alzheimer’s or dementia, even if only very beginning stage
- Diagnosis of COPD or Emphysema and still a smoker
- Any internal cancer with treatment in the past 12 months
How can you avoid being declined for life insurance?
You’ll really need to find a knowledgeable agent that understands the high risk market and can offer you rates from every competitive life insurance company to help you find out if you are insurable.
I’ve mentioned in past blog post how many agents have no clue when it comes to shopping tougher cases.
We suspect many of these inexperienced agents or agents whose only goal is to do a LOT of business will just have you apply to any companies, whether you can actually qualify or not.
These agents may just see you as a possible commission… the more people they can get to apply, the more money they can possibly make.
They may tell you things like, “If one company declines you, they’ll all decline you,” and this is SO WRONG!
We regularly help people that have been declined for life insurance in the past to get approved with other quality insurance companies, but this can take some work on our part.
Many agents or salespeople may not want to put in the work it takes to help you get the best offer possible. However, work is what it takes on more complicated cases.
We “shop” really tough life insurance cases every day, and we have the perfect system to do so.
Plus, we obtain medical records on every case, which makes it much easier for us to place you with ANY other life insurance company later.
So what do you do if you need life insurance but have significant issues?
First thing, do not apply to any insurance company until you weigh the risk versus the reward of applying.
Since there is a possibility that you could be declined, you should consider applying for a group life policy with limited health questions first.
We have access to a company whose group you can join for a small monthly fee, and then you can buy life insurance up to $50,000 (ages 18 to 50) or up to $25,000 (ages 51 to 64) as long as you are employed and working and can answer “no” to the seven health questions below.
1) Have you been diagnosed with, treated for, or tested positive for HIV, AIDS, or AIDS Related Complex?
2) Have you EVER applied for and been rejected for life insurance?
3) Have you been hospitalized in the past 90 days?
In the past 5 years, have you been hospitalized for, been diagnosed, or treated by a member of the medical profession or taken prescription medication for:
4) Angina, heart attack, stroke, heart bypass surgery, angioplasty, coronary artery stenting, or coronary artery disease?
5) ANY form of cancer to include leukemia or Hodgkin’s disease (excluding non-invasive, non-melanoma skin cancer)?
6) Chronic obstructive pulmonary disease (COPD), emphysema, or any other chronic respiratory disorder, excluding asthma?
7) Alcoholism or drug or alcohol abuse, liver cirrhosis, hepatitis, or any other disease of the liver?
Notice above there are no questions pertaining to diabetes… there are also no questions about heart disease or related ailments other than coronary artery disease.
If you have type 1 or type 2 diabetes or any heart issue other than coronary artery disease, then you may be able to qualify for this coverage.
Also notice question 2, “Have you ever applied and been rejected for life insurance?”
This is the main reason to avoid applying somewhere else first. Once you are declined by ANY company, this insurance will no longer be available to you.
If you can qualify, you should accept this insurance first if you have more significant issues, and then you can cancel it at any time (if a better rate becomes available).
Other life insurance options if you have been declined
If you’ve exhausted all other options, and you can’t qualify for the group life coverage mentioned above, then you may only qualify for guaranteed issue life insurance.
Guaranteed Issue (GI) life insurance is not the ideal coverage since most companies only offer amounts under $50,000.
GI is also expensive, and most GI companies have a limited death benefit that will be payable to your beneficiary if death occurs in the first two policy years by any disease or illness. Full death benefit will be payable right away if death is due to accidental means.
If you’re under the age of 40, there is only a couple GI companies that may offer you up to $25,000 of whole life coverage.
As long as you are a living, breathing person, you will qualify for Guaranteed Issue coverage regardless of your health issues.
Below are some guaranteed issue monthly life insurance rates for $25,000 of Whole Life insurance as an example of what you can expect to pay. These rates and the coverage are guaranteed to remain level for life:
Age 30: $40.46 $30.96
Age 40: $58.86 $46.24
Age 50: $88.50 $73.50
Age 60: $136.00 $103.50
Age 65: $163.50 $126.00
Age 70: $221.00 $171.00
Age 75: $301.00 $243.50
Age 80: $413.50 $347.25
We would only recommend Guaranteed Issue life insurance as an absolute last resort!
If you already have term life, but have been declined for new coverage, consider conversion
Conversion is the right to exchange your existing term policy to some sort of permanent life insurance without having to go through underwriting again.
Even though you can only convert from term to permanent life insurance, which is more expensive than term, there are ways to lower your conversion cost.
An agent who is familiar with running permanent life illustrations can do a short duration/short pay solve on a permanent product. This can make the conversion cost closer to a term insurance cost.
We have been able to help numerous people who are now a decline for new life insurance convert their term policies and get an affordable rate.
It doesn’t matter if we didn’t sell you the original term policy. As long as it’s through one of the hundreds of insurance companies that we are licensed to do business with, we could help you to get conversion quotes.
Bottom Line On Being Declined for Life Insurance
Almost everyone is insurable.
Finding the best life insurance rate and value for you may not always be easy, but if you’re reading this, you’re in the right place, as we shop extremely difficult life insurance cases every day!
To find the absolute best life insurance rate available to you, call us at 1-800-380-3533, click here to email, or click on the instant quoter to the right of this page and provide your name, phone number, and email address, and we will email you with information.
There are always guaranteed issue products available to you. These are expensive for small amounts like $25,000, and they have a waiting period before full benefit would be payable for death by any disease or illness in the first two or sometimes three policy years. These should always be your absolute last resort!
Since 1992, Gordon E. Conwell, III (G3) has helped thousands of ”higher risk” individuals get the best life insurance rate/value. Being a high risk himself, he knows the struggles you’ll face trying to get affordable life insurance. His unique shopping process and underwriting knowledge will result in the best offers, every time!