Term Life Insurance Articles
Reasons That Companies Cannot Use To Refuse Term Life Coverage
2010-11-26
You may be dealing with a case of insurance refusal. If your term life insurance plan is denying you coverage, you'll need to learn how to beat them at their own game. The following is a simple primer on what situations term life insurance refusal is acceptable and not acceptable.
Reasons Companies Cannot Use to Refuse Coverage
In general, life insurance companies are free to deny coverage to anyone they deem too high of a risk. If you fit the profile the company is using, you will be granted term life insurance coverage, but if you don't fit the profile that company specifies, you can be denied. The decision is left up to the underwriter who evaluates your risk as depicted in your application; if you are considered too high of a risk, the insurance company has the right to turn you down. In some states, however, legislation has been passed to protect specific demographics from denial of insurance. For example, some states do not allow insurance companies to deny victims of domestic abuse, even though statistics prove such victims to be at a higher risk for early death.
Typical Reasons Term Life Insurance Plan Coverage is Denied
When applying for life insurance, you will probably get turned down for coverage if you have a terminal illness, are significantly overweight, have serious health problems, have a poor driving record, are mentally ill and a likely suicide risk, have a criminal record, commit fraud by lying on your application, test positive for illegal drug use, are too old, or either work a dangerous job or have a dangerous hobby. All of these factors make insurance companies wary, because the statistics prove you are at a higher risk for early death than the average person.
What to Do if You Were Refused Insurance Coverage
You'll need to find out why you were denied coverage. In some cases the underwriter may have made a mistake. If the denial was related to medical issues you can order a copy of your medical history from the Medical Information Bureau and then enlist the assistance of your doctor in clearing up any misconceptions about your health. You can also challenge allegations of fraud by asking for a copy of your life insurance application history, to see if past applications are somehow conflicting with the current situation.
Alternatives to Term Life Insurance
You can apply for group life insurance through an employer, which may cost more but will at least provide insurance. You can also see if your state provides high risk term life insurance programs; some states do. These plans are expensive, but the insurance may be worth it.
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You may be dealing with a case of insurance refusal. If your term life insurance plan is denying you coverage, you'll need to learn how to beat them at their own game. The following is a simple primer on what situations term life insurance refusal is acceptable and not acceptable.
Reasons Companies Cannot Use to Refuse Coverage
In general, life insurance companies are free to deny coverage to anyone they deem too high of a risk. If you fit the profile the company is using, you will be granted term life insurance coverage, but if you don't fit the profile that company specifies, you can be denied. The decision is left up to the underwriter who evaluates your risk as depicted in your application; if you are considered too high of a risk, the insurance company has the right to turn you down. In some states, however, legislation has been passed to protect specific demographics from denial of insurance. For example, some states do not allow insurance companies to deny victims of domestic abuse, even though statistics prove such victims to be at a higher risk for early death.
Typical Reasons Term Life Insurance Plan Coverage is Denied
When applying for life insurance, you will probably get turned down for coverage if you have a terminal illness, are significantly overweight, have serious health problems, have a poor driving record, are mentally ill and a likely suicide risk, have a criminal record, commit fraud by lying on your application, test positive for illegal drug use, are too old, or either work a dangerous job or have a dangerous hobby. All of these factors make insurance companies wary, because the statistics prove you are at a higher risk for early death than the average person.
What to Do if You Were Refused Insurance Coverage
You'll need to find out why you were denied coverage. In some cases the underwriter may have made a mistake. If the denial was related to medical issues you can order a copy of your medical history from the Medical Information Bureau and then enlist the assistance of your doctor in clearing up any misconceptions about your health. You can also challenge allegations of fraud by asking for a copy of your life insurance application history, to see if past applications are somehow conflicting with the current situation.
Alternatives to Term Life Insurance
You can apply for group life insurance through an employer, which may cost more but will at least provide insurance. You can also see if your state provides high risk term life insurance programs; some states do. These plans are expensive, but the insurance may be worth it.
