Before an insurer offers you a quote for single or joint life cover, they will want to know more about who they are protecting.
The cost of insurance premiums is based several risk factors and if you have certain medical conditions; you pose an increased risk to the insurer. As a result, you’ll have to pay more for your premium to reflect your estimated life expectancy. If you’ve got high blood pressure and smoke heavily, for example, your insurer will assume there is a greater chance you will die during the term of your life policy and therefore, will have to pay out. If you smoke, are overweight, or suffer from diabetes, cancer, bowel problems, high blood pressure, or depression, stress and anxiety, you may be obliged to pay more for your cover. The obvious reason being that insurance company underwriter’s consider these conditions to be some of the biggest threats to your health.
The underwriters don’t just want to know about your personal health. Your family’s health history can significantly affect your premium too. You’ll be asked questions about your parents and siblings’ medical histories. If they have suffered with a serious medical condition, the insurance company will unfortunately assume that you too are at a greater risk of contracting these conditions. Your insurer doesn’t care if your father broke his arm playing rugby when he was 16… they are looking out for inherited genetic conditions such as cancer, coronary heart disease, stroke, and diabetes. Insurance underwriters may often come across as cold hearted and detached when determining your life expectancy and subsequently charging you more if there is a higher risk of early death, ……but that’s the nature of how life insurance works. The alternative would be to charge everybody the same, but this would be unfair on healthy people with longer life expectancies. It would also increase the cost of insurance for all… as people in poorer health would look to take out large amounts of cover, and insurers would then have to charge more to pay these claims.
When you apply for life insurance, you will be asked to complete a questionnaire. If this reveals any health issues, most life insurers will write to your doctor for details of your personal medical history, especially if you are opting for a large amount of cover. In certain cases, it may also ask you to take a medical examination before you can be insured. Don’t be tempted to brush over any medical problems in the hope of getting a cheaper premium. If these come to light after you die, which is likely – insurers look closely at these things – you will be considered in breach of your policy conditions, and the payout may be refused.
The result of any medical problems on your life premiums will depend on the illness. If you have personally endured cancer, for example, you will need to be clear of symptoms for at least five years before most insurers will offer you protection. If you have Type 1 diabetes, you could pay a premium two or three times the normal rate for cover. When evaluating your family history, your insurer’s attitude will depend on the condition, how many family members were affected, and at what age they were when diagnosed. If only one of your close relatives were affected, it may have little to no impact on your life insurance premiums. It depends on the insurer. The insurer will only be querying family illnesses that were diagnosed before age 60 or 65. If they were diagnosed after that, they will almost certainly disregard them. If there is a history of illness in the family, your life insurer will either charge you more for your premium, or may even exclude that particular condition from cover. All insurers have different underwriting rules, some will load the premiums depending on their underwriter’s view on the severity of the condition. This is why it is important to let a broker do the shopping around on your behalf.