Posts filed under 'Banner Life'
I know I have beat the subject to death and beat up on other agents who don’t beat the subject to death, but allow me to begin this Monday by sharing with you the actual cost of dragging your feet.
This particular example actually is a long time friend of mine who has trusted me with their family life insurance for some time. On an annual review this year we looked at the two term insurance policies he had in force, a $200,000 20 year term that was 5 years old and a $400,000 20 year term that was 3 years old. The total annual premium for the two policies was $1890 annually, a bit high because when he bought the first policy he was still chewing tobacco. While we did get him non smoker rates, they weren’t as good as his health would have earned him absent the tobacco use.
Now, three years out from quitting chew, in great health, there is every reason to believe that he would qualify for preferred plus rates from Banner Life. I presented the idea of replacing both policies with a new $600,000 20 year term with Banner for a total premium of $1790 annually, a $100 a year savings and a brand new 20 year term length.
This was back in late March. They drug their feet on the decision to make the change and finally decided around the first of April to go ahead. Same coverage and a longer term for less money finally sunk in. So I sent an application and ordered an exam. Right after he missed the first exam and had to reschedule we got word that Banner was having a rate increase, so I let him know that there was a deadline to the rates I had quoted and he agreed to get the job done.
I’m never pushy about the process, but I definitely kept him abreast of where he stood with the impending rate change. Well, long story short he drug his feet right past the deadline, one of those no second chances, you snooze you lose deadlines, and the $1790 he was hoping to get suddenly became $2028 annually. It went from no brainer savings to, although not much, an increase in his monthly outlay.
Bottom line. Agents everywhere should be talking to their clients about where they stand with their policies every year. A policy shouldn’t be a final document, but the beginning of a long term conversation. I know the deadline thing has been abused by some agents, but if you have any doubts about the integrity of the advice, ask the agent to provide you with a copy of the company announcement and rules for the rate change. Anytime you can save money and increase your life insurance amount or term length, jump on it like a chicken on a grasshopper.
Disclaimer. I’m back in the chicken and egg business after a 2 year hiatus so forgive the Colorado country colloquialisms.
June 15th, 2009
I was just tallying up the life insurance companies that hadn’t jumped on the rate increase bandwagon the other day and was pleased to see some of our best impaired risk companies holding firm. Lost one today though.
Banner Life and their New York cousin William Penn announced rate increases on their term insurance portfolio. To lock in their current rates applications need to be in the home office in the next two weeks. Again they are going with the no lead time approach, so if you are considering Banner quotes you might want to think a little quicker. They didn’t build any foot dragging time into this change.
As with other companies who have either done away with or increased rates just recently, there are a couple of things to keep in mind. First, these increases don’t impact anything you already have in force. Those guarantees are still guaranteed. The other thing to keep in perspective is that while rates are going up, the increases are modest. I would certainly recommend taking advantage of the current rates if you’re in a position to do so, but don’t trip over the dog trying to get to the phone to apply.
I thought it was particularly interesting the Banner endeavored to spread the bad news a bit by keeping the rate increases modest and decreasing the agent’s commission by a modest amount also. Not being a big commission watcher, I don’t have a problem with that approach. I know agents who will probably move business to other companies because of this even handed approach to Banner’s needs to bolster their reserves a bit. As for me, it is and always will be what’s best for the customer.
What started in January as the tip of the iceberg with term insurance rate increases and rate changes on universal life with external no lapse guarantees has now become a pretty clear picture of the whole chunk of ice. I predicted at the first of the year that this would impact most of the top companies by summer and it would appear that we are on track for that.
Bottom line. If you are in the market for term insurance or for permanent coverage, this is a good time to consider moving on that. While the increases may be modest, as discussed before, a modest increase over a 30 year guarantee can add up to some serious money.
May 20th, 2009
Most of the life insurance cases I work are shopped to multiple companies just so I can be assured that the insurance quote I am providing really is going to be as good as it gets and ultimately the client gets the most bang for their buck.
When I shop I am looking for the company that sees a subtle difference in the mortality risk. Most of the time the trial offers I get are bunched around the same rate class and the winner is the company that sees a case as standard plus rather than standard, preferred rather than standard plus, or a table 2 rather than a table 4. Every once in a while I get a reaction from an underwriter that is incredibly out of line with the information I provided and obviously a knee jerk reaction to, well, to something.
A case I am currently working on brought this kind of reaction from Banner Life. This client had a condition called Fuch’s dystrophy of the eye. It is asymptomatic at this point and truly, in a worst case scenario, at some point in the future might require a cornea transplant. All of the other trial offers I got ranged from preferred to standard based on treatment for mild depression, disregarding the Fuch’s as insignificant from a mortality standpoint. This was what I expected, except for Banner. They declined to make an offer due to the Fuch’s dystrophy.
I emailed back and asked for an explanation of their trial non offer and so far haven’t received anything, but I suspect that the underwriter reviewing the case had a knee jerk reaction to the word dystrophy and didn’t bother to research this particular malady to see what impact it would really have on the overall life expectancy.
Another case I was working was for someone that was being treated for depression, rather mild depression, but was being treated with a drug that is used for bipolar disorder. Most companies came back about where I would expect them to, somewhere between preferred and standard, but one company declined to offer due to bipolar disorder. It was the underwriter’s knee jerk reaction to the medication, which is a primary drug for bipolar disorder but is also used for depression that led them decline rather than clarify the facts.
Bottom line. Underwriters are human too and they occasionally misread the information presented or I present it in a way that doesn’t clarify a situation enough. But, for whatever reason the knee jerks and that company is out of the running for now. That is why we always shop to multiple companies. The more eyes that see the case the more likely that we will get a fair hearing and a good offer.
May 19th, 2009
A month or so ago I talked about a client of mine who, over the course of 4 years, has been working with me to get his rate down from the very first approval we were able to get through Empire General at a table 8, to a just approved standard plus rate with Banner Life.
I hold this client up as an example of how, when a client is really involved with the process, positive things can happen. This is a guy who has provided study results, pathology reports, and gone out of his way to get a checkup that he wasn’t even due for, simply because he knew that it would help our battle to win him better rates. We were able to improve the rate each year because of his willingness to do whatever it took. His rates were over $12,000 a year. They’re now under $4,000.
In contrast are people who contact me for insurance quotes and know little or nothing about their medical situation and for sure aren’t going to call their doctor or run by the doctor’s office to get a copy of labs or a pathology report or a copy of a stress test or a sleep study. The act as if I am imposing on them to ask for more information than they can provide me right then and there when, all I’m really asking for is exactly what an underwriter needs.
If I am providing a quote for someone with diabetes, I need to know their A1c. If it’s a history of cancer I need to know the stage and grade. If it’s heart disease or if someone has had an angioplasty or bypass surgery, I need a copy of their stress test so I know what their ejection fraction is. With sleep apnea, a copy of the sleep study is needed like all of those other things, to ensure that the quote I provide is accurate.
I can’t tell you how many times I’ve heard over the years, “Well, if it’s going to be that much of a hassle, just forget it.” I always wonder if they then turn around and tell their wives that they would have bought life insurance but the agent wanted me to call my doctor’s office and it was just too much hassle.
I suppose I am beat out of some of this business by agents who don’t hassle anyone and just quote what they want to hear, or just shoot from the hip without all the facts, but the truth is that asking for that information serves two purposes in the process. First, if the client provides the requested information, it ensures an accurate quote and generally means that I can expect them to stay involved through the application process. Second, if they don’t take that small part in their own quest for life insurance, at least in my experience, they won’t end up being a cooperative client through the rest of the application and they also have a higher lapse rate than those who really get involved.
Bottom line. Not everyone gets preferred plus rates and those with serious health issues need to find a good independent agent and get involved in their own destiny if they don’t want to over pay or explain to their spouse why they are just going to go without.
May 5th, 2009
When I do an on the phone interview with a potential life insurance client I ask a series of medical questions that help me to decide the appropriate rate classification to quote. Part of the application process, whether it is done with your agent or with the examiner is called Part 2 of the application. This is where you get the opportunity to divulge your entire medical history.
I consider Banner Life’s Part 2 medical-history to be one of the more thorough. Some of the forms ask about medical history for the last 10 years and I think this misleads potential insureds into believing that medical history prior to that doesn’t matter. You may have survived breast cancer more than 10 years ago or recovered from a stroke more than 10 years ago, but those are still relevant events that will impact underwriting. Even if you answer no to something because it happened over 10 years ago, in all likelihood there is reference to that event in your medical records and it will come out anyway. Might as well lay the cards on the table.
That is why my phone and personal interviews always start with “Have you ever been diagnosed with or treated for?” and end with “Is there anything else in your medical records that we haven’t covered?”. You can see by the medical history form that very few stones are left unturned, but obviously every possible medical issue can’t be listed. That is another radar people will try to fly under thinking that if they don’t divulge it, the underwriter won’t know it. Trust me. You want them to know it up front.
Banner Life’s form has the most extensive family history question I’ve seen. Most companies only ask about heart disease, stroke, cancer and diabetes. I always get a chuckle out of their alcohol question, “Have you ever consumed alcoholic beverages?”
My best advice whether asked by an agent or an examiner, or left to answer these questions on an application on your own….be honest. Your life is chronicled in your medical records and even in information from other insurance applications. Independent agents are good at making lemonade out of lemons. Let them do it for you.
Bottom line. We all have a medical history, or at least all of us old folks. You might be able to slide one by an underwriter, but if your policy is approved in the absence of information known to you and withheld from the underwriter, it is contestable. Don’t do that to your family.
May 4th, 2009
Continuing on with a series of posts I started last week on life insurance applications I would like to discuss the necessary (by law) and often misunderstood Authorization to Obtain Information or HIPAA authorization.
HIPAA, the Health Insurance Portability and Accountability Act, is the program that protects sensitive personal information from being used for other than the intended purpose. Even though its’ intent is to protect consumers, on occasion consumers take exception to the language in the authorization. I have even had potential clients, assuming that I am the only agent out there that requires the form, decide not to apply through me and go elsewhere in search of an agent who won’t be so potentially invasive. It’s rare, but when someone digs in their heels on the issue, they don’t buy my assertion that the same language is part of all life insurance applications through all companies and all agents.
So, what is this document? Why do people take exception to it in some cases? I have extracted a fairly common hipaa-authorization from a Banner Life term insurance application. While the documents differ some from company to company, they all have to meet the same legal requirements for language and content.
For those that do take exception to the authorization, and honestly they are few and far between, the first thing they take exception to is the expansiveness of the authorization. It allows the company to obtain full medical records, even from mental health facilities, and any other protected health information (protected under HIPAA) occurring during the last 10 years to the company’s agents, employees, vendors or representatives.
First let me be clear that full medical records and other health information are separate. Some try to interpret that in their favor as the company only being interested in medical records for the last 10 years and therefore only being interested in your medical history for the last 10 years. This would be a stroke of luck if you happen to have had a melanoma or a heart attack prior to 10 years ago, but that’s not the case. The company wants to know all of your medical history and the authorization allows them to obtain all of your medical records.
Another question that occasionally pops up is why the authorization is valid for two years. You may remember from previous posts that life insurance policies have a two year incontestability period. Should you die during that period the authorization can be used to obtain medical records needed to ensure that the claim is valid.
This authorization also rescinds, for the purpose of this application, any private agreements you might have to restrict access to all of part of your medical records. Simply put, if you want to apply you forfeit the right to pick and choose what the insurance company can see. And finally the release is very straight forward. If you refuse to sign the authorization the company doesn’t have to process your application.
Bottom line. While the document might seem one way, it really accomplishes something for both you and the company. It allows them to get all of the information needed to fully underwrite the policy and it lays down clear limits on who can see the information and how it can be used.
May 4th, 2009
Let’s don’t mince words on this subject. If someone is 40% overweight they are twice as likely to die prematurely than someone of average build. It’s not the fat that kills you, but the strain that all that extra weight puts on your body making you a prime target for obesity caused health risks.
The point I want to drive home and the key to reasonable life insurance rates for the overweight is to consider the insurance before any other health issues show up. Weight by itself can increase your life insurance rates, but not to the extent that weight plus diabetes or weight plus heart disease or weight plus cancer will.
A good example of this is a client just recently, who at 6′3″ and 325#, was able to get a standard rate through Prudential because all of the risk factors were excellent. He had blood pressure and cholesterol numbers that anyone would love to stuff in their medical records. His glucose was 87 on the exam. We talked at length and he recognized that he had a need for life insurance and that there was simply not a better time. He knew that because of his weight, his long term health could be an issue.
I was recently contacted by a man who had undergone gastric bypass surgery several years ago and had been told that, because of that surgery, he was uninsurable. Gastric bypass carries less of a stigma than it used to. It used to be looked at as kind of a lazy man’s diet, and a dangerous one at that. But more recent studies have shown that the reward of the drastic action may in fact trump the risks of whittling away at weight a few pounds at a time. The person who contacted me ultimately got a standard plus offer from Banner Life insurance, a classic case of having contacted the wrong agent who applied with the wrong insurance company the first time around.
Bottom line. It won’t cost you anything to find out what life insurance would cost you right now, but the cost of waiting could be the addition of health complications.
April 9th, 2009
