I can’t tell you the number of times that I’ve been asked, when a client is facing an increased life insurance rate due to some health issue, why the insurance company doesn’t take into account all the positive things they have going on in their lives.
There has been an industry tool called table shaving available off and on for years for universal life products. The way it works is that if a policy is rated, usually not above a table 3 (175% of standard), with credits for certain criteria the company will allow the shaving away of those tables bringing the premium back down to a standard rate class.
Now United of Omaha (Mutual of Omaha) has come up with what they call a “Fit Test”. Basically it allows you the opportunity on term insurance policies to gain credits over standard underwriting for Yes answers to health and lifestyle questions.
I think they’ve hit on some things that I’ve always felt should give a client an edge. For instance, being given credit as a lifetime non smoker. Somehow that makes more sense than giving a lifetime non smoker the same weight as someone who smoked 2 packs a day for 40 years but hasn’t smoked in 5 years.
They also give credit for one of my favorite topics, getting regular checkups and being compliant with followup. How good is that, that I would have an edge over someone who hasn’t been to a doctor since they were born?
Their family history credit is tough but good. No immediate family deaths prior to 70 of any disease. Well controlled blood pressure gives you a credit. A preferred build is a credit. Not preferred plus, but preferred.
Bottom line. I like this kind of underwriting. It allows someone with some problems to work their way back to a more affordable rate. It makes a client feel like United of Omaha is looking for positives when most companies just ferret out negatives.