Archive for August 13th, 2007
Often a person that is extremely overweight resorts to gastric bypass surgery to get everything under control. Gastric bypass, in a nutshell, sews off most of the stomach, leaving the person with a stomach that is easily filled with a minimal portion compared to what they used to eat. Life insurance companies welcome that weight loss….cautiously.
First of all, life insurance underwriters treat gastric bypass weight loss the same way they treat any other rapid weight loss. There is an assumption that the instant success won’t last and if a person really wants to eat, they will keep working at it until the can stretch their new, smaller stomach to accomodate more food.
I recently worked with a client that had kept their weight down in the 240# range for two years after coming down from 370#. We started talking about life insurance and by the time he actually did his insurance exam, he was up to 259#. We still got a good rate, but not as good as if he had kept his weight down. There is real concern when it starts climbing again.
Underwriters want to see at least one year after a person’s weight has leveled off post bypass. Some would rather see two years. Once they have reached these threshholds, they can get rates based on their current weight.
I just read a post on thediabetesblog.com by Diane Rixon that layed out a compelling case for being able to solve weight induced diabetes through gastric bypass. Killing two birds with one stone.
Bottom line. Gastric bypass may not be for everyone, but it might work wonders for some.
August 13th, 2007
This is another one of those life insurance underwriting areas where companies are definitely not all in agreement. Time to contact an independent agent who can choose the right company. They can pretty much all agree that if you have high blood pressure that is treated and well controlled, you will get a preferred rate. The change can come when you start adding other health issues.
Many companies take the stance that if you have several health issues, and any of those issues standing alone would end up with a preferred rate class, then even though you have several, you are still preferred. So let’s take the person with high blood pressure. It is well controlled so he gets a preferred rate. What if the same person was treated for cholesterol and it was also well controlled? Most companies would say he is still preferred.
What if his height and weight is in a preferred build chart and not preferred plus? He’s still going to be preferred. So, let’s add a mild allergy induced asthma that is also well controlled with an inhaler. We’re now up to four preferred underwriting issues and he is still preferred….with some companies. Others just wouldn’t be able to stand to look at all of that information and not hit you with a higher rate.
Now, please note that all of the issues are well controlled. If even one of the areas wasn’t controlled well enough for preferred rates, all of the others aren’t going to help. The rate class will end up going to standard plus or standard depending on the one poorly controlled issue.
That’s how most underwriters would view multiple impairments in the preferred category, but what if we are talking about more serious health problems? What if a person has well controlled type 2 diabetes and a few years ago had a one vessel angioplasty after being diagnosed with coronary artery disease?
Given good control and onset after age 50, a person could get better than standard rates with the diabetes alone as long as all other risk factors were good. In the absence of the diabetes, if a person had one instance of slight blockage requiring an angioplasty, we could probably, absent any other risk factors, find a few companies that would underwrite at standard rates with a good stress test to show that they were back in good shape.
But the combination isn’t good. CAD is a collateral and compounding health issue for someone with diabetes. With the combination, a person might expect to be approved at a standard rate plus as much as 2 to 4 tables (each table equals 25% above the standard rate).
Bottom line. Multiple health issues won’t necessarily change your chance of getting good rates unless those health issues are considered to have a compounding mortality experience.
August 13th, 2007
I finally got my wife to look the other way while I jumped out of an airplane this year. She’s always so nice about asking me what I want for my birthday, and for the past 5 years I’ve been telling her I wanted to try skydiving and that would be a great present. She steadfastly refused, not wanting to be a party to my smashing demise on an airport runway. So, having paid for it myself, it’s a perfect example to discuss how life insurance companies feel about you taking up risky hobbies after you already have insurance in force.
The whole thing comes down to a simple question. Were you actively planning on doing the activity when you took out the insurance? Hoping to do something at some point in the future is not actively planning. Having a date set to jump out of the airplane is actively planning. If you weren’t actively planning, you’re covered.
This question has been brought up by a number of my private pilot clients. In many cases they were ready to dump life insurance policies that they had taken out prior to becoming a pilot. So my question to them was, “at the time you took the policy out, were you actively planning to start training as a pilot?” If the answer was no, their old policy covered them. They also ask about future changes in their aviation activities. If, down the road, they get an opportunity to take up aerobatics, as long as it wasn’t planned at the time the insurance went in force, they’re good to go and fully covered.
From an insurance company point of view, when they underwrite your policy there is an assumption that people with bad habits will stop them and people without bad habits will pick them up. I have had clients that started smoking after they had insurance in force as a non smoker. They were fully covered even if they died from a smoking related cancer death. It is not uncommon for a recreational scuba diver to take up wreck or cave diving after a while. As long as they didn’t plan on doing wreck or cave diving when they took out a policy, it’s covered.
Bottom line. Insurance companies don’t assume you will remain exactly as you were when they approved your policy. Before you run out and look for new insurance because of a lifestyle change, have your policy reviewed by an independent agent.
August 13th, 2007
Scuba diving is a topic, or an avocation as they like to put it, that has insurance companies all over the map as far as how it is underwritten. If you are an avid scuba diver, you defintely want to enlist an independent agent to help you find the best life insurance rates.
There are three primary areas that underwriters look at when they break down insurability of scuba diving. The first one is easy and most everyone who dives has taken this step. You have to be certified by an organization such as PADI or NAUI.
Once you are certified, the next underwriting hurdle comes into play. Life insurance underwriters want to know how deep you dive. There are a lot of companies that are pretty comfortable with recreational diving of not more than 75 feet down. Generally recreational divers will be in the company of a divemaster and divemasters are generally very conscientious about not going beyond a diver’s certified limits. The truth is that most recreational diving takes place in 30 to 40 foot depths.
For the best rates, companies start to fall off quickly when you start diving below 75 feet. There are only a handful that will offer best rates if you are diving down to 100 feet and atbest two that will offer best rates if you are going down to 130 feet.
The third issue that underwriters look at with close scrutiny is best described as “other than open water” diving. Wreck diving and cave diving are the two most common “other” categories. Rescue diving and ice diving are also underwritten generally with a flat extra per thousand charge. If you participate in any of these activities, you will definitely want your agent to shop it extensively.
An interesting collision between two underwriting areas is the dual avocation of scuba diving and being a private pilot. While it would be a rare occurrence, there are apparently some issues with flying and diving on the same day.
Bottom line. By far the majority of scuba divers fall into the recreational category and there are plenty of options for companies. Options fall off rapidly as your diving becomes more advance.
Important note. If you have life insurance in force when you decide to take up diving, even the “other” categories of diving, you are covered. I will cover that in more detail in a post tomorrow.
August 13th, 2007
Just to follow on up on all the discussion that started with my post last week that will follow “Fat March” participants as they lose weight on national TV. I felt it would be informative for anyone who is dealing with weight issues to know that life insurance can be obtained and hopefully an encouragement as Will and Shane lose weight and move from their current uninsurable status to insurable.
I think it’s important to know that it isn’t weight alone that life insurance underwriters have to take into consideration. The truth is that weight wouldn’t really be a mortality issue if it wasn’t for all of the collateral health issues it can cause.
WebMD sums up the associated health problems on their website. People who are 20% or more overweight are at a distinctly higher risk of having heart disease, suffering a stroke, having type 2 diabetes and even contracting several types of cancer.
These aren’t things that life insurance underwriters take lightly and it showed in my quotes for the 12 participants in Fat March. Even though 10 of the 12 were insurable, their rates were substantially higher than someone their height, but with lower weight. On the other end of the spectrum, companies also have minimum weight guidelines and there are uninsurable limits on that end as well.
Bottom line. Most overweight people are insurable as long as they haven’t already started having collateral health problems. Contact an independent agent to guide you to the best possible rates.
August 13th, 2007
