Archive for September, 2009
I got this email just recently:
Hi Mr. Hinerman:
I have been reading your blog for some time. Just curious, why do I never see MetLife, my company, among your quotes? If you haven’t checked us out in a while you might want to try. Our rating guide for CAD has recently been updated and we might be able to offer on a guy like the one you posted about today (depending on his age and cath report details, of course.)
Thanks, and please keep this confidential.
Blah, blah, blah, blah, blah, MD
AVP, Medical Director, MetLife
Well, here’s the deal. I don’t have a lot of experience with Met Life, but they did come through on a trial for a client of mine as the best game in town. On my recommendation we applied with Met.
My client has a form of epilepsy called tuberous sclerosis and seizure. He was diagnosed at age 15. Most of his seizures have been nocturnal and, well, I presented all of this in an email asking for trial offers. Met Life came back with a Table 4 offer and while record acquisition has been the major time eater, early on in the underwriting process our case underwriter (different person than trial underwriter), let us know that she didn’t agree with the trial offer and thought it should be a decline.
That’s a real problem. On the one hand I have an underwriter that reads the trial, does the homework and comes up with a table 4 offer. Based on the table 4 we put together an application for a policy that worked within my client’s budget and applied. Then it ends up in the hands of an underwriter who lets us know up front that she is likely to decline the case even if it comes back no worse than our trial presentation. But, she says let’s move ahead and get 5 years records.
That took a while (two months), but we got them. Now the underwriter wants to go after some additional records (more than 5 years ago). I definitely do not get the feeling that the underwriter wants more information in order to empower the approval. I definitely get the feeling that she is looking for more meat to decline the client.
So, Blah, blah, MD, you want more presence in my blog?
Bottom line. You got it.
September 30th, 2009
We see it all the time. A young man dies in a car accident or from cancer, a totally unexpected event and an event that rips the roof right off of the life of the young wife and children he has left behind. He never considered life insurance. Life at that point seems endless and so full of other things to do and to consider.
What we get to see is an obituary asking for donations to the surviving family to be taken to a special bank account set up for the family. What we get to see is the mess that is left behind when parents or grandparents fail to not just have the life insurance talk with the young family, but go that extra step and volunteer to pay for it until the family is able to budget it or until they actually get why they need it.
I’m a parent and grandparent and I understand that we can’t run their lives, but volunteering to protect your child’s or grandchild’s future without any hassle or invasion into their personal lives, at least in my experience, is a welcome involvement.
It’s not that hard to broach because all of our kids have had friends die far too young so, while they may feel invincible themselves, at least they understand the concept of tragedy. If you volunteer to pay for the insurance you will not only put the protection in place, but begin to teach your children about responsibility. The good news for you as a parent or grandparent is that they are young and healthy and it won’t cost beans to put an appropriate amount of insurance in force. A $500,000 20 year term insurance policy on a 35 year old man is only $240 a year, $20 a month. This isn’t going to blow your budget.
So, why not just have the talk and urge them to do it? With young adults 25-40 years old that might work 1 out of 10 times where they actually follow through and they actually keep it in force. The other 9 will either listen and blow it off, or the first time that $20 a month has to compete with satellite TV, the life insurance will lose and lapse.
Will there be a point where you can turn the policy over to them? Of course there will. Those of us who survived our young adulthood all remember that Aha moment when responsibility suddenly made sense and we felt compelled to do the right things. But listen! That part of responsibility that needs life insurance is just too important, too critical to wait for the Aha. It makes far more sense to just put it in place on behalf or your children and grandchildren and be prepared to carry it as long as you need to than to risk tragedy tearing part of your family to pieces.
Bottom line. I’m not advocating not teaching responsibility and I’m certainly not saying that some young people won’t just get it and embrace it right away. What I am saying is that there are life lessons that can be shown by example and even done as a gift that need to be done when the responsibility starts, not later.
September 29th, 2009
We just wrapped up a life insurance application with a successful approval at a standard rate class, the best we could have hoped for even in the absence of the bypass history.
We have been dog determined to point out through this forum that the social stigma and risks that have often been attached to gastric bypass or lap band surgery is far outweighed by the almost immediate health benefits.
Probably the most dramatic of those is the crazy fast impact that a gastric bypass attack on obesity can have on type 2 diabetes. It is truly not uncommon for people who have been battling diabetes for years to actually be able to get off of medication within just a few weeks of surgery and have their glucose levels remain low on their own.
Of course from a life insurance standpoint, the results can take a person from truly not insurable to standard or better rates in just a few years time. Generally companies will want to see weight level off and stabilized for a year before they will reward a person with standard rates. Since weight loss usually goes on for 6 months to a year, a good rule of thumb is that the life insurance reward is going to show about two years post surgery.
In the case we just got approved the client who is 6′2 and was 405#, has been stable at 265# for over a year. He is no longer treated for diabetes or high blood pressure. And he is able to provide his family with life insurance protection that because of his weight and risk factors was simply out of reach before.
Bottom line. Gastric bypass surgery is probably not for everyone, but considering the mortality risks associated with unchecked obesity, it’s worth a look.
September 28th, 2009
Abnormal ekg’s make up a significant percentage of of the reason for postpones and declines on life insurance applications. Often it’s news to the applicant and just as often it’s something that their doctor may have told them about a long time ago and told them it wasn’t anything to worry about. After all, “It’s not like I had a heart attack or something”.
A critical thing to keep in mind is that how two companies handle an abnormal ekg can be as different as night and day. On plenty of occasions I have shopped “abnormals” that led to a decline with one company and was able to get it approved standard and occasionally better with another company. Certainly on more than one occasion we have been able to disprove the abnormality when a client is willing to get an independent ekg from their own doctor. While a person would hope that all ekg’s are created equal, an ekg done in a doctor’s office, generally a 12 lead ekg is often more reliable and different than a 6 lead ekg done by a paramedical person while you’re lying on your living room floor.
So, is your doctor wrong when they know you have an abnormality but they tell you it’s nothing to worry about? The truth is they’re probably right on the money because they know you, your health history, your lifestyle and if the abnormality is fairly benign, whether it has changed over the years.
So, is the underwriter wrong? Probably not based on the information they have and their company’s underwriting philosophy. He is probably following the guidelines. Therein lies the rub in this situation. Both are doing their job correctly but they seem to have adversarial opinions. The real truth is that the opinions aren’t adversarial because they’re not offering an opinion on the same thing. One opinion is about you alone and how you’re doing and the other opinion is about you pooled together with say, all the other people who have a right bundle branch block and what their overall mortality experience is compared to people without that abnormality.
Bottom line. Since you will likely never get the two sides to see eye to eye on the subject, when faced with an abnormal ekg, armed with a copy from the insurance exam and preferably an second go round with your own doctor, enlist an independent agent who can shop as many companies as it takes to get a rate that works for you.
September 24th, 2009
I heard through another agent this morning about a 68 year old client of theirs who was declined by Banner Life due to his PSA increasing from 2.1 to 3.1 over the last 15 months.
It must be really dark where that underwriter keeps their head. If the client was young that might be cause maybe for a postpone to get a checkup with a urologist, but old guys have several reasons to be cut some slack on the PSA issue. First and foremost is that almost all guys in their late 60’s have an increasing PSA. A large percentage suffer from BPH, benign prostatic hypertrophy, enlargement of the prostate, and this drives the PSA up. Prostatitis becomes more common and that drives the PSA up. And, there is always the chance that a guy has prostate cancer and that would increase the PSA.
While the word cancer might send some into a dizzying downward spiral, everything I have studied would suggest 1. That a change in PSA from 2.1 to 3.1 in 15 months shouldn’t be alarming at age 68 because at worst it might point to a low grade prostate cancer and 2. low grade prostate cancer at age 68 is, in the whole scheme of things at that age, hardly a mortality risk.
The other issue with that small an increase in PSA with both readings falling well within the normal range, is that the PSA test is known for its’ ability to be enormously inconsistent. One study showed that when testing was done 3 times over a 90 day period 46% remained pretty constant, 33% had changes of 1% and the largest changes were an increase of 7.5 and a decrease of 5.3.
So the accuracy or at least consistency of the test is at least not the quality that an underwriter should want. It certainly begs to wonder why anyone, underwriter, doctor or Fedex driver would jump to any conclusion based on two readings 15 months apart. It isn’t a well spent leap of assumption.
Bottom line. Banner has been acting a bit rudderless lately and this type of decision is indicative of that more than what a client or agent should expect.
September 24th, 2009
Ok, so it’s a “what if”, but there’s a lot of folks out there who won’t see the end of the day. Nothing shocking about that. A lot of those deaths will be expected and a lot of them, well, I guess there will be something shocking about them.
So, if you woke up this morning and God tapped you on the shoulder and said you were going to be leaving later today, what would you do to prepare for the void that was about to be left in your place? And just so this doesn’t turn into a feature length movie, let’s talk practical versus emotional.
I think I am safe in saying that if someone knew (supernaturally) the time was near and they were still healthy (maybe a heart attack coming this evening with no real symptoms), the opportunity to review and possibly increase the amount of life insurance they are carrying would be a consideration. Is that $250,000 worth of life insurance you’ve always carried because you never felt like it would be needed somehow feeling a little short now that you know your widow will be missing your income for a long time and facing retirement on her own?
The truth is most men feel like unsung heroes for carrying life insurance at all, and they also feel a little put out for having to spend money on something they don’t believe in. Show me a man who truly recognizes their mortality and you will generally be looking at a man who is adequately insured. Most men don’t buy into the whole premature death possibility so for them it’s a true waste of perfectly good play money, or investment money for the more serious.
But the truth is that men don’t have such a great track record when it comes to not dying prematurely. Studies show that 1 in 6 young men who make it to age 26 don’t make it to age 64 and in my mind, any way you slice it in this country, death before 64 is premature. How come if a person has a 1 in 6 chance of winning something they will bet heavily and when they have a 1 in 6 chance of causing a disaster they won’t insure against that possibility?
Bottom line. If today was the day? If you’re telling me that you know for a fact that it isn’t, you’re guessing.
September 23rd, 2009
I had a client just recently who works for State Farm as a claims adjuster and was declined for life insurance by to them due to his obesity. He’s 6′1, 415 pounds.
I shouldn’t get down on State Farm over this since by most life insurance company underwriting guidelines he has stretched well past the breaking point. But dang! The guy does work for them.
Well, whining not being the point since we got his approval and his new policy is in force with Prudential, I just wanted to share some of the upper limits of what Prudential will consider assuming no truly egregious risk factors. The risk factor thing is worth mentioning because it is highly unlikely that someone approaching these limits with diabetes is going to get an approval, but the client that I just mentioned did have well controlled blood pressure and that didn’t impact his approval.
So, if you’re this high……….and weigh this or less……..
5′2 303#
5′3 313#
5′4 323#
5′5 333#
5′6 344#
5′7 354#
5′8 365#
5′9 378#
5′10 387#
5′11 398#
6′0 409#
6′1 421#
6′2 432#
6′3 444#
6′4 456#
6′5 468#
and so on. These are the upper limits of approval period. These are well above the approval limit of almost all companies so don’t be thinking you can take this post down to your local Allstate agent and say, “look, you should be able to get me approved because Ed said so”. He will wish that he could. He will look for every way he can to get er done, but it isn’t happening.
Bottom line. You need to find an independent agent that understands obesity and knows how to help. You need to be talking to someone who is savvy enough to be able to tell you where you stand right up front without dragging you through an underwriting and application process. You need someone with a track record of helping those with the same issue succeed for their families.
September 22nd, 2009
An extremely common cause for the derailment of a life insurance application is an elevated liver function test (LFT) on the life insurance labs. This can result in an unexpected (and unwanted) butt kicking when you had no idea that there was anything going on.
To make matters worse, that butt kicking may not have any medical science or mortality studies to back it up. It is just the way it’s been done forever. 10 years ago I sold a lot of insurance for a company called Federal Kemper (you old folks might remember the commercial with the Kemper Calvary!!??) Well, Kemper had an opinion about one of the LFT’s. If you had a DUI ever in your life and your GGTP was elevated at all, say 66 (0-65 being normal), you were automatically declined. I had a case where the DUI offense was 30 years prior. Still an auto decline.
GGTP is a liver function test that is not commonly used by physicians but is almost always used by insurance companies. Most underwriters say they like to GGTP because it is a non specific test, showing positive when there is any kind of irritation of the liver. Other underwriters like those at Kemper didn’t make any apologies for the fact that they thought anyone with an elevated GGTP was a lush. To them, the only reason for the elevation was alcohol abuse.
The other two LFT’s used commonly by doctors and insurance companies alike are the AST and ALT. By far the majority of companies out there will postpone, if not decline, an application in the presence of elevated liver functions. A postpone would be to give you time to get a complete workup to determine why the liver function was elevated. A decline would be, well, to get rid of you.
The problem with this blanket rush to judgment or even overt concern in the face of elevated liver functions from an underwriting standpoint is that while an underwriter can certainly look at the result and say that something may be abnormal, they have no idea what, to what extent, or even if the results are accurate. They most certainly can’t pin any kind of an accurate mortality risk to the results. Liver functions change rapidly and can be very different two weeks from now than they are today in the absence of something like a disease that is consistently and constantly stressing the liver.
The good news is a leading company that has written guidelines that allow clients to get past the initial knee jerk decline. Just an idea how far this company has separated itself is the fact that they won’t even rate a client with a single LFT elevation within certain limits. In other words, if just one of the three LFT’s is elevated you could still get preferred plus rates. Their guidelines would allow no rating if the GGTP is 4 times normal or lower, the ALT is 4 times normal or lower or the AST is 5 times normal or lower.
Their guidelines also allow best rates if two or more liver functions are elevated but not more than 2 times normal. For the millions each year that are declined, postponed or highly rated for these same kinds of results, this is great news.
Bottom line. You can say it a million times but sometimes it just keeps begging constant repeating. Not all companies treat all underwriting the same. What you car insurance company offers on life insurance has no bearing on what you can find through a knowledgeable independent agent.
September 22nd, 2009
“In the beginning there came responsibilities and with that came the need for life insurance.” I get asked all the time when a person is old enough that they should seriously consider life insurance as part of their financial plan and the answer is clear, when you have responsibilities that would fall on someone else if you didn’t have life insurance.
Do I think students with student loans should have life insurance? Yup! Do I think a high school student that takes out a car loan, co signed or not, should have life insurance? Yup! Do I think a young married couple should have life insurance even though they don’t have children or a house? Yup.
We are a country that has somehow learned to look the other way from our responsibilities. Today, I was talking with an older client of mine. He’s 74 and lost his wife last year. He and his wife both carried policies because it was the responsible thing to do.
They did OK for themselves. All the bills are paid and they had a paid for house in Maine. He was asking my advice about his policy and whether he should convert it to a permanent policy. I reminded him about our conversations over the years about responsibility being the driving force behind life insurance and I asked, “With your wife gone, what are your responsibilities?”
Well, there really aren’t any was the end answer. His kids are doing great, he didn’t owe any money, and when we factored in that it would cost about 5 times as much for him to carry his term insurance on as permanent insurance, well it just didn’t make sense anymore.
Bottom line. The end is just the opposite of the beginning. It doesn’t make sense anymore when all of your responsibilities are taken care of.
September 21st, 2009
Back in mid July I started working on a life insurance case for a young man with type 1 diabetes. He had already discovered how easy it is to find a company to decline him, but the picture he painted was not one that led to a logical decline.
He had the same strikes against him that most with type 1, insulin dependent diabetics, have. He was diagnosed at an early age so, no matter how you shook it out, he was going to be dealing with type 1 for most of his life. He would have to work as hard at controlling his diabetes as most folks work at their full time jobs, always just a slip up away from complicating things with more risk factors.
But he was doing a bang up job. He took his diabetes seriously from the time he was diagnosed, not an easy thing for someone in their teens. He monitored himself regularly and administered treatment just as be had been instructed by the his doctor. He didn’t fall into any bad habits. There’s always a temptation when part of your life has been reconfigured to fudge a little bit here and make up for it a little bit over there.
Nuf said. He is a model type 1 diabetes patient. We had several offers, and while very highly rated, at his early 30’s age, affordable for what he wanted to accomplish for his family. After all was said and done, exam examined and records reviewed, the company found that he actually presented less of a mortality risk than originally thought and the policy was approved at a better rate.
Bottom line. Like virtually all health issues, underwriting is looking at what has been done to negate or at least decrease the mortality risk in higher risk cases. In lower risk cases they check to make sure that other risk factors aren’t creeping in that can complicate things. Ultimately, and I know this seems a stretch if your experience has been with the wrong company, they are truly looking for a way to give a fair and affordable approval. This is a classic case where they did exactly that.
September 21st, 2009
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