Can I be denied life insurance?

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Important things to know...

  • There are many reasons why you could be denied life insurance coverage
  • There is an underwriting process that determines your eligibility for life insurance coverage
  • Medical risk, occupational risk, and moral risk are all factors in the determination of your life insurance elgibility
  • Establishing life insurance early in life while you are healthy is the best strategy for obtaining life insurance coverage

There Are a Myriad of Reasons Why You Can Be Denied Life Insurance


To purchase life insurance, you must qualify on several different fronts. You will be examined, scrutinized, interviewed and documented, all in the spirit of classifying you according to underwriting standards.

Once you are denied life insurance for any reason, it may be very difficult to obtain coverage in the future.

A smart strategy is to buy life insurance while you are younger and healthier because once you have it, it cannot be taken away from you for any reason, except for the fact that you may choose to drop it or stop paying the premiums on the policy.

The reasons why people are turned down for life insurance cover several categories, some which can be avoided and others which cannot. Favorable circumstances such as youth and good health work for establishing coverage, older age and poor health work against the establishment of life insurance coverage, among other things.

Learn more about being denied for life insurance below and make sure to use our free insurance comparison tool above!

The Underwriting Process

Life insurance underwriting is the process of evaluating a person’s eligibility for being approved for life insurance coverage.

The underwriting position in a life insurance company is an important one, as the underwriter, first of all, must protect the life insurance company from adverse risks because a bad decision in underwriting could cause the company to pay a claim in the future that is unwarranted.

Life insurance underwriting is all about risk, and although most people don’t die right away, it is to the insurance company’s advantage to only insure risks that are good and which will have mortality results that fall within the company’s guidelines.

Steps In The Underwriting Process


 The Application

The life insurance application is the first step in the underwriting process and is usually filled out by a licensed life insurance agent or broker.

It is important that the applicant is totally truthful when answering the questions, as they can, and will, be verified from other sources.

Questions on the application cover information about the applicant such as name, address, birth date, Social Security number, occupation, the length of time at addresses and in your occupation.

There are questions about hazardous hobbies and sports, and whether or not you are in the military on active duty, and tobacco and alcohol use.

There are detailed questions in regard to your health history, and the application has a list of all the categories of health problems that a life insurance company could be concerned about such as heart history, cancer history, blood pressure, cholesterol, most of the internal organs and possible ailments, as well as questions about who your current doctor is and the recent history of visits.

If any of the health questions are answered in the affirmative, detailed explanations are required along with the name, address, and phone number of the physician and medical facility involved.

 The Physical Examination

In some cases, a physical exam will be required. This can be due to the amount of anticipated coverage exceeding the non-medical threshold, or because of a medical condition that the underwriter wishes to have current information to move forward.

If a physical exam is required, it will be performed by a company approved doctor or paramedical company, and it will be performed at the life insurance company’s expense.

 The Background Check

In many cases, the life underwriter will want a background check simply because some people do hide past experiences that could pose an underwriting risk, or they just forget things.

Examples of activities that could cause concern would involve past criminal activity, hazardous activities such as scuba diving, flying as a pilot, hazardous occupations, and foreign travel to hazardous areas of the world.

– Simplified Issue

Today, many life insurance applications can be approved by what is called “Simplified Issue,” which means if the face amount of the policy is within a certain range, and if the applicant is in good health, the policy can be issued right away without going through a lot of questioning and background investigation.

This is usually more applicable to younger applicants who have little or no health history.

Reasons For Life Insurance Declinations


The Physical or Medical Risk

There are certain medical conditions that will be a decline right away. The most obvious would include severe heart issues, such as degenerative heart disease, recent heart surgery, current and ongoing major cancer, cirrhosis of the liver, Lou Gehrig’s Disease, Muscular Dystrophy and Multiple Sclerosis.

Different life insurance companies have different thresholds for many of these conditions, but in a general sense, it is all about statistical longevity and how it will mathematically affect the risk factor for the insurance company.

This is why it is essential, if possible to establish one’s insurability at a young age to carry forward and have life insurance when you need it later in life.

Many medical risks can be less severe and can be included for coverage with an increased rated premium. It depends on the severity and prognosis of the disease.

The Occupational Risk

There are certain occupations that pose risks, although some may not totally disqualify an applicant, they might require an additional rated premium to get coverage.

Such occupations as a steeplejack, skydiving instructor, offshore oil worker, coal miner, underwater demolition, and similar jobs would fall into this category.

The Moral Risk

There are instances when a life insurance application will be denied coverage due to a moral risk.

This involves a current or past life experience of the applicant in activities deemed to be immoral to the point that the event places the person in a position of additional hazard and possible exposure to adverse selection.

As one agent tells the story, he had an application denied on an individual, but the agent was not given the reason, as it is confidential information.

Yet, the agent had to get back to the applicant and tell him he had been denied. The applicant then admitted to the agent that he was involved with organized crime.

In Conclusion


While there are many reasons why you could be denied life insurance coverage, there are more people who are approved than are denied life insurance coverage.

If you have an illness that is ongoing or a physical condition, chances are you might still be able to obtain coverage, yet pay an additional rated premium. If your condition gets better, the rating can be removed. If it gets worse, you still have the insurance.

The best strategy is to obtain life insurance at a young age while you are in good health, so it will be there later in life when you need it. Once you have life insurance coverage in place, it cannot be changed by the insurance company or taken from you.

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