What To Do If You’ve Been Declined?

For many seniors, shopping for life insurance comes with anxiety. You’ve reached a different phase of your life, and may not be sure what kind of life insurance you need. Or, maybe you have a good idea of how much and what type of insurance you need, but you’re afraid of high premiums and declines. 

One of the biggest insecurities seniors face when applying for term or whole life insurance is the possibility of decline. We’re here to help. 

The good news is your age alone will not necessarily result in a decline for life insurance. Rather, underwriters look at a variety of factors when rating your risk factor. But what if the worst happens and you’ve been declined? 

Step 1: Contact a Life Insurance Agent

The first step after you’ve been declined is to immediately contact an independent life insurance agent. As a senior facing a life insurance decline, it’s easy to get dejected and desperate for coverage – which can lead to rash decisions. 

One of the most important things to remember when shopping for a policy is that you are only seeing the tip of the life insurance policy iceberg. There are hundreds of companies and even more policy options that may not decline you. It’s important to remember that *many* underwriting steps happen before a decline and that not all carriers are going to go through the exact same process of rating you. A decline at one carrier could be a substandard or standard table rating with another carrier.  

This is where an independent agent comes in. It is his or her job to know the industry and, chances are, they have worked with someone in a similar situation to yours. This means they can go over all of your options with you to find a carrier that will cover you. 

Step 2: Explore Your Alternatives

Speaking of all of your options: if you are a senior who cannot get a traditional life insurance policy, you have quite a few options at your fingertips. 

One of the first options you may consider for alternative coverage is no-exam life insurance coverage for seniors. This type of policy provides coverage for individuals without requiring a medical examination. These policies are often more expensive than traditional term life insurance policies for seniors (often with a smaller benefit), but they are becoming more competitive. We do not typically recommend this policy for seniors, but we are firm believers that some coverage is better than no coverage, and this may be a good alternative while you wait for a more traditional coverage option.  

You may also want to consider a Guaranteed Issue life insurance policy, especially if you are over the age of 55 and suffering from serious health issues or are permanently disabled. Offered to anyone between the ages of 50 and, in some cases, 85, guaranteed issue life insurance also does not require a medical exam and can be issued quickly, making it a good interim option while you and your agent look for a term policy for your condition. While these can be issued quickly, GI policies typically come with a two year waiting period, meaning if you pass away before the end of two years, your beneficiaries will only receive the premium that was paid for the policy, not the death benefit. The benefit for this type of policy is also often lower than the benefit from a more traditional term life insurance policy. 

Be sure to contact your agent before looking into this type of policy, as you may not even need gap coverage after a decline and, instead, might be able to get a term life insurance policy at a substandard or standard table rating.

Hear us out: a table rating is going to be expensive, but, often, the expense is not too far above what you would pay for a no-medical-exam policy or for another form of coverage for a decline. And, with a table rating, your premium price is also partially based on the size of the policy you’re looking to purchase, and you can always increase the size of the policy as you lessen your risk.

An independent agent may sit you down and reassess how much life insurance you need and what the best alternatives are for your unique situation, but don’t worry! It is possible that these alternatives and higher premiums are only temporary, if you take the right measures to improve your health and rating.

Step 3: Take Proactive Measures

Declines can occur for a number of reasons – across all age groups, not just for seniors.Here are some common reasons seniors may face declines:

• Criminal record
• High-risk hobby
• High blood pressure
• Diabetes
• Certain cancers
• Heart disease
• High blood pressure
• High-risk occupations
• Alcoholism
• Tobacco use

The important thing to note is that, often, you can take measures into your own hands to get coverage at a better rate. 

If your decline is health-related, you should make an appointment with your doctor. High blood pressure, diabetes, high cholesterol and heart disease can all be managed through a doctor-recommended diet and exercise program. Following this regimen and regularly returning to your doctor for check-ups are surefire ways to show life insurance underwriters that you are mitigating your risk. This is especially important for seniors, who are more at risk for certain diseases. 

If your decline is hobby-related or due to a criminal record, you also have options. Certain hobbies come with a high-risk label, but risk can be reduced if you’re taking proper safety measures such as getting safety certifications. A criminal record also won’t necessarily result in a decline, particularly if it’s a misdemeanor or a lesser infraction. 

Step 4: Have Patience

One of the most important things anyone can do – especially seniors – when facing a life insurance coverage decline, is to have patience. 

Finding the right coverage takes time for everyone, and it may take extra time depending on why you’ve been declined. Life insurance is a complex industry, and there is a policy out there for everyone, even for seniors facing coverage decline. 

Improving your health, mitigating your risk, and searching for the best policy for your needs all have one thing in common: they take time. We firmly believe declines are not the final word, and are dedicated to finding you the coverage you want and deserve at prices you can afford. Call us today if you are a senior who has been declined for term or whole life insurance coverage.