I’ve been working some particularly tough impaired risk life insurance cases lately and it really drove it home to me that if a person with higher risk life insurance impairment is using an agent who only represents one or two or three companies, they have almost no chance of a good outcome with their life insurance application.
I have a pool of about 30 companies that I use. Some are in my portfolio virtually for only one reason, while others are just always competitive impaired risk companies. There are about 15 companies that fall into that second category and every case I touch gets a look from the underwriters of those 15 companies. I can say without shame that I am not the quickest life insurance quote around, but I can say with pride that there are very few impaired risk cases or high risk cases where I come in second. It takes me two to three working days to get quotes from all the companies I send the information out to.
So lately there’s been a string of tough cases and they have all taken the same route through all of the best companies plus any other companies I think might have some value added to the hunt. Several of these inquiries have come back with only one company interested in underwriting the application. When they aren’t interested they email back sterile little lines like “regret, unable to offer” or “we prefer not to participate in this risk”. Which is good. I don’t want to waste the customer’s time applying with a company that doesn’t want to participate in their risk.
But that is exactly what happens when you deal with an agent who only represents one company, whether by choice or because they are contractually captive. There are roughly 2000 companies that sell life insurance in one form or another in the US. On any given day there are about 1% or less of those 2000 who are willing to approve an impaired risk case. Now, I’m not talking about high blood pressure or high cholesterol. When I talk about 1% and sometimes .1%, I am talking about impaired risks like bipolar disorder, people who have been treated for drug abuse or alcohol abuse, seizure disorders, type 1 diabetes, cancer and heart disease or high risk like mountain climbers, professional car racers or risks that other agents just don’t know what to do with like private pilot life insurance.
When treated blood pressure or treated cholesterol are seen by just one company because it’s the only one an agent represents, the life insurance application has one underwriter with one set of guidelines and the odds are not that good that you will have randomly picked the company that will provide the best rates. If you up the ante to more severe impairments or higher risks, one agent with one company isn’t going to get it right. Even if you use a large agency that purports to represent a large number of companies but favors one over another for compensation reasons, you are likely to still have an unhappy outcome. Even if you use an completely independent agent that represents all of the companies I do and more, if they don’t know how to effectively shop a case, you may get approved but the chances are slim that you will get the best rate you could have attained.
Bottom line. For you it all comes down to getting approved and getting approved at the best rate available. For me it comes down to making absolutely sure I present you with the best possible outcome the first shot out of my gun. I make absolutely nothing for coming in second and you don’t get approved or you pay too much if you go to the second best company. If you have any questions, or have been declined or treated unfairly, call or email me directly. My name is Ed Hinerman. Let’s talk.