There are many reasons why you may be declined for life insurance. Every insurer has different criteria to assess the risk of providing individual life insurance. Factors such as serious health conditions, severe mental health conditions, or a disability are considered high risk and are often reasons for being declined.
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High risk basically means that you are more likely to claim from the insurance provider sooner rather than later. The insurer is, therefore, less likely to make money from the premiums that you pay and the risk of approving the life insurance will need to be carried by other policyholders, increasing the rate that the insurer needs to charge.
The 13 most common conditions that could result in a life insurance policy being denied or declined include:
1. High Blood Pressure
High blood pressure or hypertension is a risk factor for many health conditions. An insurer is more likely to provide life cover if you are taking steps to lower your blood pressure and keep it under control.
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2. High Cholesterol
A cholesterol or HDL (High-Density Lipoprotein) ratio of below 4.5 may be a reason for denial. However, it could only mean an increased insurance rate if you show that you are improving your cholesterol ratio. You must lower the LDL and boost your HDL cholesterol to normal levels.
3. High Blood Sugar
High blood sugar is a marker for diabetes, and other health conditions considered high-risk factors by many insurers. Some insurers will provide cover if you are diabetic and the disease is being treated and managed, while others may deny an application outright. Finding a more lenient insurer regarding blood sugar levels is best before applying.
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Many people are shocked that life insurers will decline an application on the grounds of obesity. However, this is normally only in the case of extreme obesity, as it can result in high blood pressure, high blood sugar, and many other high-risk health conditions.
Selecting an insurance carrier with a lenient policy towards build requirements is important: your height-to-weight ratio.
5. Alcohol Consumption
Elevated liver function, cirrhosis of the liver, or a positive alcohol marker are all reasons for the denial of a life insurance policy. It is recommended to reduce or quit drinking alcohol entirely for a few months before applying for insurance. Alternatively, do apply for no-exam life insurance, where you must complete a medical questionnaire but not undergo a physical exam.
However, if you lie on the questionnaire regarding alcohol consumption, a claim could be turned down if you die from a liver-related condition.
6. Dangerous Or Hazardous Occupation
A dangerous occupation is a risky business and, therefore, more likely to result in a denial from an insurance carrier. Looking for insurance policies designed for high-risk occupations or individuals is recommended. This can also apply to sports, hobbies, or other activities considered dangerous or unusual risks.
If you work in a field that is considered dangerous, such as logging, fishing, roofing, electrical power, and even farmers and ranchers, you may be denied coverage. This is especially true if you are older and have other health issues.
7. Driving Record
Motor vehicle accidents are one of the leading causes of death and an insurer may access your driving record to establish the risk. So if you have multiple speeding fines or have been arrested or charged with a DUI more than once, it could result in a denial.
While young people are the most affected, seniors are also tagged as dangerous if their driving record shows danger signs. It is best to wait until your DMV record is clear before making an application.
8. Kidney Disease
This is normally revealed by blood or protein in the urine during a physical exam. It is best to opt for life insurance that does not require a physical exam if you know you suffer from kidney disease or a related condition.
9. Cardiovascular Or Heart Disease
Cardiovascular disease is another leading cause of death and is therefore considered high risk by life insurers. If it can be shown that the heart or other related condition is being treated and under control, a life insurance application may be approved. Alternatively, opt for the no-exam life policy.
10. Recreational Or Illegal Drug Use
Most insurance carriers will deny an application if unexplained drug markers are detected in the blood or urine analysis. It is best to refrain from drug use before a physical exam or select a carrier that does not require an examination. Even marijuana which is gaining acceptance in modern culture, is still a big red flag for insurance companies that are not comfortable covering someone who engages in recreational drug use.
11. Blood in the Urine
Blood or excessive protein levels in the urine may be a symptom of excessive physical exercise. However, it also may indicate kidney disease, which is more likely if you have not exercised excessively. Insurance companies will want that cleared up before approving your application.
12. Mental Health
Some insurance providers may decline applications based on severe mental health conditions like schizophrenia. They may also decline for conditions such as Alzheimer’s Disease, which results in progressive decline. If it can be proven that the condition is manageable and being treated, approval may be granted.
13. Lack of Income
If you cannot afford the insurance, then you will not be allowed to own it. You must reduce the benefits and make other adjustments to make it more affordable.
If you have had an application for life insurance denied or declined before, it can make it more difficult to receive approval in the future. However, this does not mean that it is impossible to apply for life insurance in the future successfully.
How Not To Get Rejected by Insurance Providers?
Simply making some lifestyle changes and ensuring that high-risk health conditions are managed and treated can result in approval. Also, looking for insurance carriers who have a more soft approach to risk assessment could mean approval even if you have formerly received a rejection.
It may also be a simple matter of paying a higher rate for life insurance than young, healthy policyholders.
What is the best way?
The best approach is, however, to opt for life insurance that does not require a physical examination if you are aware of any health conditions that could result in a denial. No exam insurance is more expensive than conventional policies as the risk the insurer carries is much higher.
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A medical questionnaire must be completed to be approved as part of the application process. This questionnaire will determine your risk assessment and the rate you will likely pay. If you lie on the questionnaire or in the application document, the policy can be nullified, or the cover can be turned down in the event that you die from causes related to the falsified information.