I just spoke with a prospective client who applied for a term life insurance policy through a friend of a friend….He had been to my site before but had decided to give this agent a try.
His only issue is that a parent died from cancer at age 59. With the exception of Prudential that starts beating up on family history prior to age 70, most companies will bump you two rate classes for an immediate family death due to cancer or heart disease prior to age 60. It’s an underwriting rule that stretches completely out of reality the chance for a genetic link between you and your parent in most cancers.
There are of course some cancers that have genetic pass through predispositions, such as breast cancer. But let’s stay in control. When a woman has a father who died of prostate cancer or a man had a mother who died of ovarian cancer, it really isn’t a factor.
Anyway, this client went to the friend of a friend who had him apply with Genworth Life and Annuity. Their family history underwriting guideline places him solidly in their third best rate class. No wiggle room. No negotiating.
With Genworth at their Select rate class this young guy’s $400,000 of 30 year term would cost $566 annually. With ING Reliastar their family history underwriting doesn’t involve cancer at all so he qualifies for preferred plus rates and should safely expect to be paying $353 annually.
The local agent he went through was simply inexperienced and thought that, well, family history is family history and he won’t get any better. I know for myself I make it a point to know which companies stand out on underwriting points and am constantly poking around to find out where there is some slack and which underwriters might be willing to bend a bit.
Bottom line. I would never say to avoid an inexperienced agent. Heck, if you do that we’ll never have any experienced agents to replace us old guys. What you can do though is let an inexperienced agent know that you intend to shop to make sure they are offering you the best advice. That will generally prompt them to ask a supervisor or mentor about whether they are likely to get beat.