Frequently Asked Questions for Life Insurance

You can find Life Insurance Quotes from our listings by selecting the category: Life, and then choosing a sub category such as: Whole Life, Term Life, or Universal Life. Once you are on the Product page, fill in the zip code box, and click submit. The next page will list our partners for which you may receive quotes and apply for insurance.

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In general, it is more difficult to obtain a life insurance policy when an individual has pre-existing conditions. However, if an experienced agent is contacted, all documents are gathered, and a health summary (a summary of your health up to this point in time) is created the insurance policy should be easier to acquire. The limits of the policy might be low, but the agent should have some options for you. Additionally, most states offer assistance in these cases; to learn about your state visit the State Guides to Health Insurance section of our health insurance page.

The Medical Information Bureau (MIB) maintains confidential medical information on life insurance applicants obtained during the underwriting process. This information is available only to insurance companies. No one else can look at your MIB file. When you apply for insurance, the insurance company will request information regarding your health history from the MIB. The insurance company will also send information regarding any new medical tests and current health impairments you may have to the MIB. This information will then be available in the future to other insurance companies if you apply for additional life insurance.

Simply put, a misstatement of age or gender is lying. Two things can happen when you misstate or misrepresent your age or gender on your life insurance application. The policy can be amended back to the date the policy was issued to reflect the correct information, or—if the misstatement is discovered after you die—the insurance company can adjust the benefits paid on the claim to reflect how much coverage the premiums that were paid would have purchased had you provided your true age and/or gender.

Misstatement of age and/or gender may be discovered at any time prior to the payment of benefits, since it is not subject to the contestable period clause in the policy.

Your policy will define exactly what happens in the event of such a misrepresentation or misstatement.

All life insurance policies stipulate a contestable period (usually two years) during which the insurance company can dispute any information provided. If a company learns within this period that certain health information was not correct, the company may void the policy if the misstatement of information was material. Information is considered material if the company would either have not issued the policy, or would have issued the policy with a different rating.

The insurance company assumes the information provided on the application is accurate. Inaccurate information on an application is judged material if it would have affected the premium charged or the decision made by the insurance company to issue the policy. A discovery of material inaccuracies may cause the insurance company to adjust or even void the policy. Most information can only cause a policy adjustment if it is discovered before the end of the contestable period (usually two years). Misstatements of age or gender can cause an adjustment of the policy at any time, even after your death.

There are a number of settlement options that you can elect when you buy the policy, or at any point during your lifetime thereafter. If you do not select a benefit settlement option, the beneficiary can select one following your death. The options include:

Lump Sum Payment. Your beneficiary receives one payment for the full death benefit.
Annuity. Your beneficiary can have the death benefit paid out in a series of payments over a specified period of time or during his or her lifetime. While annuity rates are guaranteed in the policy, normally these rates are lower than what you could find elsewhere.

Most insurance companies use your age at the nearest birthday, meaning within the first six months after your birthday your current or true age would be used; after six months your age would be considered nearer your next birthday, and the older age would be used. Therefore, if your age for insurance purposes will change in the next four weeks, you can lock in your lower age by paying the initial premium with your application, which will make your policy date the same as your application date. Or, you can sometimes choose not to pay your premium with the application and ask, if available, that your policy be backdated to take advantage of your lower age.

Backdating is to the process of requesting that a life insurance policy be issued based on the previous age of the person being insured. Normally, premiums are based on the age at the time of the application. The older the person being insured, the higher the annual premium. To reduce the annual premium, some insurance companies allow for backdating 60 to 180 days from the date of the application in order to lower the age of the person being insured. However, if backdating a policy is permitted, premiums must be paid from the effective date. In other words, if you backdate three months, you will need to pay the premiums for those three months, even though no life insurance coverage was provided during that time.

You don’t have to, but by naming a beneficiary, you decide who gets the death benefit on your life insurance policy. If you do not name a beneficiary, then the death benefit goes to your estate. It is in your best interest to name at least a primary beneficiary.

When a life insurance company agrees to issue a policy, the company is effectively agreeing to accept the amount of risk associated with your desired coverage. As a result, a considerable amount of information is required for a company to complete the underwriting process that determines whether a particular application represents a “reasonable” risk for them.

The statutes of the state in which you signed the application will govern your insurance policy.

Life expectancy affects the annual premium required on a life insurance policy. Currently, women are expected to outlive men by about 6 years. As a result, women usually pay lower life insurance premiums than men of the same age. If you live in Montana, you’ll pay the same rate, since Montana state law forbids the use of gender in setting insurance rates.

Most insurance companies will reduce your life insurance rate when a person has been a non-smoker for two to five years. Losing weight can also lower your premium once it has been verified by a health professional. Rate reduction is contingent upon how each insurance company verifies both of these rate reduction activities.

Generally, companies will not deny you coverage based solely on the fact that you work in a hazardous or high-risk occupation. You will, however, be asked some additional questions. Depending on your responses to these questions, a company may rate the policy higher, thus increasing your premium.

Participating in high-risk leisure activities does not generally stop you from obtaining life insurance. However, you may have to pay a higher premium or pay the normal premium and have an exclusion added to the policy. The exclusion means that if death occurs as a result of your participation in the leisure activity, the policy death benefit will not be payable.

Most life insurance companies will not reject an application for life insurance based solely on your driving and driving-related conviction record. If you have had three or more moving violations within the last three years, however, or have been convicted of a DUI within the last five years, most companies will issue the policy with a higher rating.

Possibly. Your application will be reviewed independently of any prior decisions. The insurance company will obtain any information they believe is necessary in order to determine whether or not your application for insurance should be approved. The company will then determine whether or not to accept your application based on all the information they have obtained.

Certain health conditions can be passed down to our children. So, while you may not currently have cancer, diabetes or heart disease, if anyone in your immediate family has had one of these diseases, it is one of the many risk factors that an underwriter needs to consider when reviewing your application for insurance.

Yes. Since people who smoke are on average expected to live shorter lives than nonsmokers, smokers pay higher premiums.

There are no set guidelines that an insurance company will follow to find out if you are a smoker. If the information was disclosed to a healthcare professional or provided to the insurance company, the insurer will use such information while considering a candidate’s qualifications for a health or life policy.

*If false information is given to the insurance company, they do have the right to deny coverage.

Current medical information, such as the results of recent physical examinations or blood tests, gives the underwriter reviewing your insurance application an up-to-date picture of your health. By contacting your doctor, the underwriter can verify the answers you gave on your medical history and gain additional insight about prior illnesses. Knowing your current health and past medical history helps the underwriter evaluate life expectancy risks.

Most companies will not bill for premiums on a monthly basis. Many companies, however, do provide for payment of premiums monthly by automatically debiting your checking account.