We talk a lot on here about how your age is not a barrier to getting affordable life insurance. We’ve also talked about what to do if you’ve been declined for life insurance. What we have not discussed is how to get a reconsideration or re-rating on my life insurance premiums. Is it possible to lower the cost of my existing insurance premiums? Yes, it is possible.
Whether you were rated too high, declined, or are just looking to lower your premiums, you have options. In our professional opinion, it’s simply a matter of taking the proper measure to improve your health and knowledge. In life insurance, knowledge is everything and can save you hundreds of dollars a year.
Buying a policy when you’re young and healthy is inexpensive, but the longer you wait to protect you and your family, you could be facing an increase in premiums. For many individuals – especially seniors who need to renew their life insurance policies or are looking to buy a policy for the first time – the fear of decline and high rating due to your age and health is real.
When To Get Re-Rated
Knowing when to re-evaluate your life insurance policy rating can be tricky. A good rule of thumb is to ask to be re-rated or reconsidered if your health has improved since you bought your policy.
Not all carriers will re-rate or reconsider you and, in some instances, you may be better off canceling your policy and buying a new policy once the new coverage is in place. Rule of thumb, never ever cancel an existing policy until a new policy has been placed and in force with the new carrier. As always, be sure to speak to an independent life insurance agent before re-rating your life insurance policy. Here are a few instances in which you may want to request a re-rate or reconsideration:
- You have lost weight and kept it off. Being overweight is a huge risk factor for serious health problems, including heart attacks and strokes. Slight weight gain is nothing to warrant an increase in premiums or a re-rating, but the more weight you gain – and your age – the greater your risk will be.
If you were rated as “standard” or “substandard” due to your weight, but have taken proactive measures to manage your weight, you should request a re-rating.
- You’ve followed a doctor-prescribed regimen to lower your blood pressure. Like obesity, high blood pressure is a red flag for many risks. Chronic high blood pressure, especially, can earn you a low rating. When you’re asking for a re-rating, be sure to list any and all medications you’re taking to manage your blood pressure.
- You have quit smoking. Smokers often have a difficult time getting rated and wind up paying large premiums. The easiest way to get affordable life insurance as a smoker is to quit smoking. If you have quit – and have been smoke-free for at least 2 years – you will most likely qualify for a re-rating. You can even potentially qualify as a non-smoker! If you have medical records that show a marked improvement in your health due to quitting smoking, be sure to report this information to your agent or your carrier.
- You have quit drinking and are attending AA meetings. Like smoking, alcohol abuse is also a red flag, health-wise. Alcohol abuse can lead to liver problems, high blood pressure, and strokes. If your alcohol consumption was the reason for your low rating and high premium, but you have since stopped drinking, you might be eligible to request a re-evaluation.
- You have had a medical condition that has improved. If you find yourself saddled with high premiums because of weight-related conditions – such as diabetes – or past heart, lung, arthritis, stroke, or other conditions, you are most likely taking the proper measures to get healthy again. Your doctor will prescribe a treatment regimen for these conditions, and, occasionally, seniors may find themselves fully on the mend.
Underwriters will take a look at the severity of your medical condition, its causes, and what steps you’ve taken to improve your health. Please note that this will take time; in many instances, improving your health also means going at least a year without a recurrence of your medical condition.
- You’re taking your medication. This seems obvious, but you should always take any medications your doctor recommends. Showing that you’ve managed your symptoms and are taking your doctor-prescribed regimen seriously is a fast-track to earning a better rating.
- You’ve changed your hobbies or lifestyle choices. Health changes aren’t the only reasons underwriters rate you as high risk. Some hobbies and lifestyle choices will also increase your risk. Certain hobbies, such as skydiving, scuba diving, piloting, or racing are looked at as risky. Underwriters will also take a look at your driving record, so be sure to give an agent a call if you have had past risk infractions, such as a DUI, as you may have to wait longer for a re-rating (most companies will consider a re-rating or reconsideration for this risk after about five years).
Ceasing these hobbies, or earning certain safety certifications, can help communicate to underwriters that you are taking measures to limit your risk. If you’re unsure of how a carrier will view your hobby, give us a call.
What Happens During a Re-Rating or Reconsideration?
When you’re applying for a re-rating, you will have to undergo a medical exam. Be sure to get all of your medical records from your physician, and to communicate to your agent how your health has changed. He or she will then help you prepare to re-present your case to your life insurance carrier. Essentially, you will be going through the entire underwriting process again.
Your overall picture of health – along with your age and lifestyle choices – is what underwriters are looking at when deciding how much you should pay for your life insurance policy. Not all risk is viewed equally by all underwriters. If you are sticking with the same carrier, a re-rating will be very similar to the application process, and your agent will be able to help you communicate your unique situation.
Because each company views risk differently, not all situations will warrant a re-evaluation of your coverage prices. Most carriers won’t go through the process of reconsideration unless you’ve had an active policy with them for at least two years. If you don’t qualify for reconsideration but believe you should be paying lower for your life insurance policy, give us a call! We’re happy to walk you through your options!