Not a day goes by that I don’t read some “how to” life insurance article that claims that being declined for life insurance is right up there with getting kicked out of the country club. You will just never be OK again! You will be black balled.
Being declined is no fun and I know that, but it is also a long way from the end of the road. In fact for many a decline it is simply a good place to start. So, the myths!
1. A decline muddies the water and taints any other attempts to apply. If that was true I would have been out of business years ago. While all applications ask if you have been rated or declined prior to this application, no good companies view that as a negative factor. When I shop a declined case for quotes I always mention the decline(s) and I’ll be honest, I think there may be an upside if you were declined by companies like USAA or State Farm. The good underwriters know you likely didn’t get a fair hearing with those companies.
2. Declines show up in the Medical Information Bureau (MIB) report. Wrong! If you were declined because your cholesterol was off the charts, the MIB code will indicate you had high cholesterol. It will not indicate what action the company took because of that information.
3. No exam life insurance is a good way to avoid a decline. Wouldn’t it be cool if it was that easy. You know you have a medical problem so you just avoid an exam that will make it show up. But wait! Even no exam life insurance asks medical questions and they ask enough to uncover just about anything you could hide by not taking an exam. Remember, it’s not called “no exam and lie about your health” insurance. Check it out for yourself. You can be declined.
4. You can turn around a decline by having your doctor talk to the underwriter. Highly unlikely you will even be able to arrange the conversation and if you do, it will be a little like having your French speaking friend try to talk a Mexican policeman out of giving you a speeding ticket in Juarez. They don’t speak the same language.
5. Once declined by a company, always declined by that company There’s a two part answer to that. Some declines are really “postpones”. The company will decline to offer you coverage until some event happens. You have a full cardiac workup. You get your A1c down below 8. You have your elevated liver functions checked out by a doctor. Once those things are done you can be reconsidered. The other instance is when a company declines you without obtaining medical records. Sometimes those records contain the very information it takes to make an underwriter comfortable with approving a policy. Get the salvation information out of your medical records and have your agent shop it, even to the company that just declined you. It’s an interesting outcome sometimes.
Bottom line. Don’t fret a decline. Embrace it. Declines uncover all the bad news and make it so much easier to find a good approval. I’ve been there so I know it’s a tough pill to swallow, but if your agent can’t get the job done give me a call.