18 June 2012 0 Comments

What You Need To Do To Get The Best Life Insurance Premium

I just covered why life insurance companies require so much information before they’ll issue a policy. Now, let’s take a look at what to expect in the underwriting process.

It is likely that you will start by receiving a free medical exam from a paramedic or doctor arranged for by the insurance company. You must use the medical resource provided by them. Using your own doctor won’t work. This exam is likely to include a blood draw and a urine sample. This will indicate, among other things, if you use nicotine or other substances and have the HIV virus. The blood tests can also assist you in obtaining lower premiums by verifying a healthy life style.

Depending on your age and the amount of insurance, an electrocardiogram and even chest x-ray could be added. Age, amount and your health history will also determine whether the insurance company will obtain copies of medical records from doctors and hospitals where you have received treatment. The insurance company pays those doctors and hospitals a fee to obtain your records. DMV records may also be obtained. For larger amounts of insurance, inspection reports are frequently ordered. An inspection report includes interviews that will provide information about your lifestyle, criminal activity, net worth, and employment history.

This entire underwriting process usually takes between four and eight weeks before a policy is issued. This can be delayed if you saw a doctor whom you do not mention on your application, but other medical records obtained include that doctor’s name. Automatically, the process of obtaining medical records could start anew. That’s why it is crucial to mention all doctors you have seen when the agent or paramedic asks for your medical history.

If you are in a rush to get a policy (perhaps you are replacing an old contract whose grace period is about to expire), tell your agent. Never let the grace period on an existing policy expire until your new policy has been issued, is in your possession, the premium has been paid, and any delivery forms requested by the issuing insurance company have been signed and given to either the agent or the company. Beware of insurance companies and agents who promise shortcuts to this underwriting process. Except for very small death benefits, even their best premiums will likely not be competitive. And unless you’re not a very good risk, you’ll probably end up overpaying.
Select an agent – and an insurance company – carefully. Your life depends on it.

On my next blog I’ll do a quick wrap up of my tutorial on what you need to know before applying for life insurance and then give you an idea of where I go from here. Are you having fun yet?

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