Why Underwriters View Diabetics As High Risk

Why Underwriters View Diabetics As High Risk

When you apply for life insurance coverage, the insurance agents are going to look at a variety of different factors to determine how much of a risk you are to insure. The more risk that you are, the more they are going to charge you for insurance coverage. If you’re too great of a risk, then the company could decline your application.

Life insurance underwriters are employed to assess the risk that you pose to a company. “Risk” means the likelihood that your policy will have to pay out, and since diabetics have a much higher chance of developing long-term health complications, like heart disease, neuropathy, and kidney failure, insurance underwriters automatically label your application as risky.

A diabetic who poses an average, or standard, amount of risk, will be charged a standard premium. If you have a good A1C and no complications then you fall into this category with certain insurers.

diabetics high riskA table rating is when a company adds a premium or a tax onto the standard rate. This is for those who pose a higher risk, like diabetics. There are some companies that automatically assign a diabetic to a table rating, regardless of their level of blood sugar control, while other companies evaluate the entire picture to determine whether or not to add an extra “tax” onto the premium.

Most diabetics worry about high life insurance premiums due to their health condition. There is some truth to this, but there have been a lot of positive changes in life insurance underwriting in recent, which gives diabetics with good control a lot of affordable options. There is even one company that will offer preferred rates to type 2 diabetics with excellent control. A preferred rate means you will get the absolute lowest premium.

Because life insurance is one of the most important safety nets you’ll ever buy, it’s vital you make the best choice for your loved ones. If you’re an applicant with diabetes, you may be worried about getting rejected for coverage or how much you’ll pay for your plan. Don’t worry, there are plenty of options for insurance coverage and ways you can protect your family. It’s our mission to ensure you have the insurance protection that your loved ones needs if something were to happen to you.

Levels of Life Insurance Underwriting

When you apply for life insurance, whether you are diabetic or not, there are different ways that an underwriter can evaluate your application. You can view this in levels. The most thorough level includes an application, health questionnaire, as well as a medical exam where blood, urine, height, weight, etc. are examined. The least thorough underwriting process is a health questionnaire that may only have two disqualifying questions.

Here are your options for insurance underwriting:

Fully Underwritten – A fully underwritten life insurance policy requires you to disclose just about any and all health related issues. You will have to answer an extensive health questionnaire and you will be required to take a medical exam. In some instances, the insurance company will obtain information from your primary doctor and some may check your credit.

Simplified Issue – A simplified issue policy does not require a medical exam. There is typically a health questionnaire and possibly a phone interview. Most companies will also get your permission to check your medical history from the Medical Information Bureau, and your prescription history from various databases.

Guaranteed Issue – A guaranteed issue life insurance policy has no medical exam, no health questions, and no phone interview. Some companies may have one or two criteria that would disqualify you (a terminal illness with less than 2 years to live) and a minimum and maximum age that someone is able to apply.  The premium on this type of policy is much higher than a traditional policy, but may be the only option for someone with serious complications from their diabetes.

Which Underwriting Criteria is Best for Your Diabetes?

Your overall level of blood sugar control will determine which type of underwriting you should go for. Underwriters will evaluate several factors to determine this, but the #1 factor they are interested in is your A1C test.

  • If your A1C is below 7.0 and you have no complications, then a fully underwritten policy is the route to take and you are likely to qualify for standard or possibly a preferred rate.
  • If your A1C is 7.1 to 8.5, then a fully underwritten policy may be best for you, assuming that your overall health is generally good.
  • If your A1C is 8.6 to 10, then a simplified issue life insurance policy may be the best option to ensure that you can qualify for coverage.
  • If you have an A1C over 10, an underwriter sees your diabetes as uncontrolled and you pose a very high risk to the company. It would be impossible to get approved for a traditional fully underwritten policy, but there are companies that offer guaranteed life insurance, which may be suitable for you.

Again, there are many other factors involved in the underwriting process. Are you a type 1 diabetic or type 2? Do you administer insulin or use oral medication to control blood sugar? Or do you rely on diet alone? Were you diagnosed with juvenile diabetes as a child or were you diagnosed with type 2 after 70? Do you have any complications? Do you smoke or drink?

Not only are they going to look at your diabetes diagnosis, but they will also investigate your overall health. They will want to know about any other health complication, your heart rate, and much more. In fact, the company is going to look at everything from your health to your hobbies.

You get the picture. All of these factors are weighed to determine whether or not you are approved for life insurance coverage. It is a delicate process to make sure you apply to the right company and make an intelligent decision about which underwriting standard is best for you.

Getting Affordable Life Insurance As An Applicant With Diabetes

Regardless of your health or any pre-existing conditions that you have, like diabetes, there are several ways that you can get cheaper insurance premiums for your life insurance plan. Making a few lifestyle changes could save you hundreds of dollars on your life insurance coverage. It’s important that you lower your risk in other areas of your life.

The first thing that you should do is quit smoking or using chewing tobacco. When you apply for life insurance, one of the biggest factors is going be if you use any tobacco, which is going to make you a much greater risk for insurance coverage. In fact, smokers are going to pay around twice as much for life insurance plan versus what non-smokers are going to pay for the same sized plan. If you want to save money on your plan, you’ll need to kick those bad habits.

The next thing that you should do is improve your overall health. As we mentioned, your A1C levels are going to play a huge role in how much you’ll pay for your life insurance, which means improving your health is an excellent way to get lower premiums. Two ways that you can do this is by sticking to a healthy diet and getting regular exercise. Both of these are going to help you lower your glucose levels, help you lose weight, lower your cholesterol, and reduce your chances of being diagnosed with other health complications.

Guaranteed Issue Plan

If you’ve ever been declined for life insurance because of your diabetes or your health, don’t assume you can’t get life insurance. There are several options that you can choose from, one of those is buying a guaranteed issue policy.

With these policies, there is no medical exam or health questions you have to answer. Because there is no exam or questions, there is no chance of being declined for life insurance. All you have to do is answer some basic questions, and then you have life insurance. Sounds like a great deal, right? No exam or questions and you get coverage, but there are a few drawbacks.

The first one is you’re severely limited on how much life insurance you can buy. Most insurance companies will only sell you around $25,000 worth of insurance. For most households, this isn’t nearly enough life insurance. Not having a large enough plan is one of the worst mistakes you could make for your loved ones. Before you purchase one of the guaranteed issue plans, calculate how much life insurance your loved ones will need if something tragic were to happen to you.

Another drawback of these policies is their cost. Without the health exam or the questions, the insurance company is taking a risky bet to give you coverage. They will offset that risk by charging you higher rates. A guaranteed issue plan is going to cost three or four times more. If you want to save money on your life insurance coverage, you need to apply for a traditional policy with a medical exam.

Work With An Experienced Independent Agent

I mention this over and over again, but that’s because it is the simplest way to ensure you get the right diabetic life insurance policy for your needs. Many people fear applying for life insurance with diabetes, but if you work with an independent agent you can rest assured that you raise your chances of getting an approval. Independent agents work with dozens of companies and they know which companies to avoid and which companies to look at. Get started today and get connected with an independent agent where you will be able to compare the rates of several companies, based on your unique diabetes situation.

Every insurance company is different, and all of them have different underwriting, which means that you’re going to get different rates depending on which company that you get the quote from. Instead of wasting your time calling of all of the companies yourself, let one of our independent insurance agents do all of the work for you. We have years of experience working with applicants diagnosed with diabetes.

You never know what’s going to happen tomorrow, which means that you shouldn’t wait any longer to get life insurance coverage that your family deserves. If something tragic were to happen to you, and you didn’t have life insurance coverage, your family would be responsible for a massive amount of debt and final expenses. That’s where your life insurance plan comes in, it will give them the money that they need if anything tragic were to happen to you.

If you have any questions about life insurance with diabetes or ways that you can get the most affordable plan, please contact one of our agents today. We would be happy to answer those questions and connect you with the best insurance plan to meet your needs. You deserve to have an affordable policy, regardless of your health.

We are a group of independent insurance agents, and we have years of experience working with all types of clients across the country. We know shopping for life insurance is not a fun task, and it can be even more confusing and frustrating. Instead of wasting your time researching companies or being left on hold, let us do everything for you. Don’t wait another day to give us a call and connect you with the perfect life insurance policy for you.

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