When you apply for life insurance, it’s common that the insurance provider will want to know a few things about your health. This enables the insurer to assess the risk of issuing you a life insurance policy and to set your premiums (what you’ll pay for coverage every month) according to that risk. This process is called medical underwriting.
There are many different types of life insurance coverage – some of which don’t put applicants through extensive underwriting. But, for those who are in reasonably good health, medical underwriting can help save you money on your policy and also give you options for higher coverage amounts.
Think of it this way: the healthier you are, the lower your premiums are likely to be. Typically, as people age and acquire various health conditions that could affect life expectancy, the premiums for a new life insurance policy will be higher. If you know how medical underwriting works, you can make the most of the process in order to seek the best possible coverage for the lowest possible price.
How the medical underwriting process works
To determine the fairest possible price for your policy, your insurance company will want to know about the current state of your health. This means you’ll be asked questions about your age, weight, height, medical history, your lifestyle choices, and any other variables that might influence your future health. These questions are ultimately used to inform the underwriting process where the insurance company assesses the risk of providing you with coverage.
If your insurer determines that you are a low-risk prospect, your premiums will likely be lower than a high-risk prospect of the same age. For people with riskier health profiles, insurers may charge a higher monthly premium, exclude certain kinds of coverage, limit the amount of coverage offered, or even refuse to offer coverage at all.
Every insurer has its own underwriting process. At Haven Life, the process of medical underwriting for a Haven Term policy, issued by our parent company MassMutual, looks like the following:
- Submit an application: An application will be used as a starting point for your overall health. Once an application is submitted online, the information is analyzed in real-time and compared it with third-party data sources. Often, you can get an instant decision on eligibility and, if approved, start your coverage that day.
- Third-party data sources: Every insurance providers utilize the same third-party data sources when conducting medical underwriting. This includes the Medical Information Bureau (MIB), prescription history, motor vehicle records and identity verification. These sources do a combination of verifying the information you reported and help the insurance company prevent fraud. For example, at Haven Life, if upon the real-time reviewing of your application and prescription history there are follow up questions about what has been prescribed and why, we’ll immediately ask you those questions while in the same online session.
- Paramedical exam: In many cases, a medical exam is needed for medically underwritten coverage. Often, this can be done at your home, work or a facility — it’s up to your preference. This exam can include measurements for height, weight, and blood pressure; a life insurance blood test, and a urinalysis/drug test. At Haven Life, if additional information is needed once the application is submitted, we will help you schedule aexam.al exam..
- Attending Physician Statement: Depending on the results of your paramedical exam, your insurer may order an Attending Physician Statement in order to seek clarification about your medical condition. Full disclosure: if an APS is needed, it will extend the time until you receive a final rate. The Attending Physician Statement is a summary of your health condition, written from your doctor’s point of view. This can be handy for a number of reasons. Consider, for example, if you have high blood pressure only because you are taking a certain medication that causes hypertension as a side effect. You will want your insurance provider to know this.
- Final rating: This is the last step in the medical underwriting process. Your final rating will determine what policy you are offered, and at what price.
There are several key factors (don’t worry, we’ll get to them in a moment) that your insurer will use to place you into a rate class. Every insurer identifies and breaks down rate classes in a slightly different way, but here is a hypothetical example of how a rate classification might look. Additionally, each rate class has specific prices for tobacco users:
- Most Preferred might refer to low-risk applicants who are in optimal health and do not engage in risky activities. Applicants in this class would receive the best rates and the most comprehensive coverage.
- Preferred might refer to moderate risk applicants who are in good overall health and generally avoid risky lifestyle choices. Applicants in this class would still receive good rates and coverage but would pay a little more than candidates in the “most preferred” category.
- Standard Plus might refer to somewhat risky applicants with a few health concerns and a few bad habits. Applicants in this class would pay a higher rate than candidates in the “most preferred” or “preferred” categories.
- Standard might refer to one of the higher risk class of applicants who are in less-than-optimal health and/or make fairly risky lifestyle choices. Applicants in this class would pay the highest rates and might encounter coverage limitations.
Easy + Simple + Inexpensive
“The easiest, simplest process for receiving term life insurance. And the premiums were the lowest quote.” —MichaelLearn more
Read more at
Key factors that affect coverage and rate class
So, what are some of the factors that determine your coverage options and rate class? Here are some of the most common examples:
- Age: Most health risks increase with age.
- Biological sex: Men can expect to pay more than women, because men, on average, do not live as long as women. This is the case in every state besides Montana.
- BMI: The best rates and best coverage are reserved for people who fall into healthy weight ranges for their height.
- Tobacco use: You can expect to pay more if you have used tobacco in any form during the last 12 to 36 months. This includes cigarettes, pipe tobacco, chewing tobacco, or any other product containing nicotine.
- Cholesterol: High cholesterol will mean higher premiums.
- Blood pressure: If you have high blood pressure, that makes you riskier to insure.
- Medical history: A history of cerebrovascular disease, cancer (excluding certain kinds of basal cell skin cancer), diabetes, or heart disease will have a negative impact on your coverage and/or premiums.
- Family medical history: If both of your parents passed away at relatively earlier ages or had health issues due to cerebrovascular disease, heart disease, or diabetes, your insurer will see you as a higher-risk candidate.
- Alcohol and substance abuse: In order to get the best coverage at the lowest rate, you should have no history of alcohol or drug abuse.
- High-risk occupations: Skydiving instructors and stuntmen will pay more for life insurance than most of us.
- Avocations: This basically means “dangerous hobbies.” Underwater spelunking or parachuting off of high cliffs will put you into a higher risk class than someone who collects stamps.
- Driving record: DWI/DUI convictions or other moving violations in the past few years (depending on the insurer) will affect your rates and coverage.
- Travel plans: A journalist who spends a lot of time in dangerous countries will pay more (and/or receive less coverage) than a school teacher who rarely leaves her own zip code.
It’s not just easier life insurance, it’s an easier life.
Learn about the perks that come with being a Haven Term policyholder.Explore Haven Life Plus
How to get the best deal on life insurance
Getting the best rate on a life insurance policy ultimately comes down to the following:
- Buy coverage when you’re young and healthy – once you go through the life milestones that cause you to need coverage (buying a home or getting married) then it’s usually time to buy a policy. Usually at these times, you are young, healthy and will be eligible for the best rates.
- Monitor and improve your health – Small health improvements can have a big impact on your final rate. Learn more about how to be your best self for a medical exam.
- Consider your lifestyle choices – smoking, excessive drinking, and high-risk hobbies all can impact which rate class you qualify for.
- Shop around – You should always compare quotes among different providers and agencies before choosing a policy.
When it comes to your health, there are some things you can control and other things you cannot. The key is to focus on the former rather than the latter. A family history of cancer is not something you can choose to eliminate, but your diet and exercise habits are probably in your hands.
As for lifestyle choices, you may be willing to change some things. Others may be worth the risk for you. If you love race car driving, you are not likely to give up that thrill in exchange for lower life insurance premiums. On the other hand, driving within the speed limit is a fairly easy (and probably wise) adjustment to make.
The medical underwriting process is detailed for good reasons. It helps your insurer control the cost of life insurance, not only for their own bottom line but also for yours. The fact that you’ve finished this article (thanks, by the way) means that you’re now better educated and informed to face the life insurance buying experience with confidence and clarity.
Peace of mind might be closer than you think.Learn more
The information provided is not written or intended as specific tax or legal advice. Haven Life Insurance Agency does not provide tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel.