For this video, I have a client who saw some of my videos and asked a question related to that. I had touched upon the topic when I had an appointment with her but she still wanted to know more about the health ratings that you can get with life insurance. She was also interested in knowing how these ratings impact pricing. And, finally, if we can do better than what we have.
It was a great question because it opens up a huge discussion.
If you’re looking to get a term policy, you will need a higher degree of health. So, you have to be on, generally speaking, three prescription medicines or less.
But there are many exceptions to this. Generally, you’re looking at 60 years old or less, but you know that you can go up to 80 years old and even beyond. Technically, it just starts to get very expensive and you have to be in prime health. Let’s say, you’re 70-80 years of age, you can technically do a term policy, even if you’re in perfect health with no prescription medicines. It’s going to be very costly because you’re looking at a larger coverage policy. So, the insurance company is going to be on the hook for thousands of dollars, potentially. It just depends on what you need. So, you need to be in much better health to get a term policy. You need to have a health rating generally of anywhere from standard to standard Plus.
Generally speaking, there are about five or six health ratings. The lowest health ratings are generally a graded or return of premium. Whole life policy return of premium term is a good thing, but the return of premium is graded for a whole life policy. Generally, they’re having some health issues they’re concerned about and they’re not going to approve you at a lower cost. So, the price will be higher because they see you as a higher risk client. If you’re looking at the standard, that’s kind of an average health rating and it’s neither good nor bad.
So, most policies are going to fall in that category. They are standard.
Standard plus is an above-average health rating. In order to get that and anything above, it needs to be a fully underwritten policy. Generally, you see these with term policies, not with whole life policies, although there are some exceptions there as well.
There are healthier ratings with whole life policies as well. You don’t have to be in perfect health to get a preferred rating. In fact, given the access, our company has to different insurance companies, we can generally put someone into a preferred rated policy, which lowers your price even if you have health problems. So, even if you have high or low blood pressure, cholesterol problems, diabetes, heart issues, kidney issues, liver issues, lung issues, etc., you can still get into the preferred category.
We have great access to all these companies, and that’s the key to getting the best price. So, when you choose any company, make sure that they have access to a number of insurance companies.
Check out my other videos about risk rating and actuarial tables.
If you can get the highest health rating, your price is going to be one-third the cost of a standard health rating. It is significantly lower than the other categories and hence a big deal. It’s going to save your family a significant amount of money. You can get more than one person insured in the same amount that you would have paid for one person. So, you can have three or four times the coverage at the same cost just by adjusting that health rating. Make sure that you have someone that has the access to find the best company for you. After all, it’s a lot easier to spend money than to earn money.
This Chad McMann with ‘Protect with Insurance’ in the beautiful Prescott Valley.Thanks for sharing this time with me. Let me know what I can do for you.
If you are located in the Cottonwood, Sedona, Flagstaff or Prescott area and are looking for more information on affordable Life Insurance please don’t hesitate to contact us. Use the links below or call us directly at: (928) 323-0933.