How to search for business life insurance with health problems?
This article will give you the tips and information you need to know in order to find the companies that offer the most competitive rates on business life insurance with health problems.
It is important to first understand that each life insurance company evaluates health and lifestyle differently. One company may frown on individuals with a history of cardiovascular disease. Others may look more favorably upon them. Some companies may do an outstanding job evaluating diabetics whereas others may not.
So, how do you know how to locate the company that will provide you with the absolute lowest rate in the industry?
Your agent can be your best friend
When looking for carriers that offer the lowest rates on life insurance with health problems, you need look no further than your agent. But, is your agent a special risk agent?
Many agents are captive. This means they can only offer life insurance protection with one carrier. Why would you want an agent who only offers one company. This is like a restaurant that only offers one type of meal.
A special risk life agent is usually an independent agent. They will have contracts with dozens of insurance companies. This enables them to negotiate and shop among the best carriers.
But, it is also important to understand that just because an agent is independent and represents dozens of carriers, does not mean he understands the special risk market.
The special risk agent will have unique knowledge and years of experience representing individuals looking for life insurance with health problems.
This specialty agent will know what questions to ask. They will know what carriers like certain conditions such as diabetes, MS, high blood pressure or heart disease risks.
Business Life Insurance
So, business life insurance can typically mean several things. Below we will look at some scenarios where a business life insurance policy might be needed:
- Key Person Life Insurance- Key person life insurance typically entails a life insurance policy taken out by a business on a key employee. The key employee can also be an owner of the business. This particular policy would provide needed funds to replace the key employee or owner.
- Buy-sell Funding- Buy-sell business coverage is a very common type of protection. This usually means purchasing a policy on each owner of the business. The funds from the life insurance policy are used to buy out the other partners share of the stock. This in turn allows the heirs of the owner to be paid in cash for their value of the company.
- Business Loan- Often times a company will need a loan to purchase equipment or to expand their business. Many times the lender will require a life insurance policy has collateral for the loan. This guarantees the lender is paid back.
These typical business life insurance purchase run pretty smoothly unless- their is a health problem.
Let’s look at what can happen to a business if one or more of the insured’s has a health condition that might preclude them from possible life insurance coverage.
Using the examples above:
Key Person Coverage-
Joe is the top sales person at ABC Distribution Company in Atlanta, Georgia. Joe has all the contacts with the top distributors and has brought in the most business for the company over the last 5 years. Dave the owner of ABC Distribution Company knows if something happens to Joe, he would not only need to spend top dollar on a replacement, but his business could suffer significantly if Joe passes away.
Dave decides to incentive Joe to stay with a key man using a permanent cash value policy. In simple terms, if Joe stays for 20 years he gets the cash value growth inside the policy for retirement. If Joe passes away, the owner using the death benefit to reimburse his company as well as take care of Joe’s family.
The problem is Joe had triple by-pass heart surgery 5 years ago. The owner knows he may have a hard time finding a life insurance company willing to offer protection on Joe.
Dave contacts his current insurance company that handles his liability insurance and building coverage. Dave speaks to an agent at the company and explains his predicament concerning Joe’s health.
The property-casualty agent has no idea if his company can insure Joe, but not wanting to lose a sale decides to go ahead and take an application and get Joe examined for the coverage.
After about 3 weeks, the property-casualty agent gives Dave the bad news. Declined for coverage.
Dave is very disappointed that coverage is not available. Dave goes online to see if other companies might issue coverage.
Dave comes across a website that specializes in life insurance with health problems. Dave contacts the agent to see what options might be available.
The expertise of a special risk life insurance agent
Dave and Joe both meet with Mike the special risk life agent. They explain the coverage they are looking for, and also how Joe had recently been declined by another carrier for heart disease.
Mike explains to them that it is not unusual for a big name company to decline someone for medical reasons. He tells them how the area of special risk life insurance is limited to just a few dozen niche companies.
Mike is a bit concerned that their will be a decline on Joe’s medical information bureau (MIB). But, knowing this upfront Mike feels confident that he can negotiate an offer from one of his special risk carriers.
Mike tells Dave and Joe that he would like to make an informal inquiry to several companies an see what offers might be available. He tells them both that a new application or exam would not be required until he had a good tentative offer in hand. Joe was relieved he didn’t have to complete more paperwork an exams.
Mike will need to get more information from Joe regarding his medical history and heart history. He will need the answers to some health questions. This will help Mike negotiate the best offer among the carriers.
Questions for a by-pass heart surgery scenario-
- Date of heart by-pass?
- How many vessels were by-passed?
- Have you had any of the following? Heart attack, angioplasty, heart failure, valve surgery?
- On any current medications? What?
- Have had a follow-up EKG or stress test since by-pass? Results?
- Any chest discomfort since by-pass?
- Any of the following? High cholesterol, overweight, high blood pressure, diabetes, irregular heart beat, peripheral vascular disease?
- Any tobacco use in 5 years?
- Any other major health problems?
You see most typical experienced life agents would not know these questions to ask. They would just have someone apply for coverage much like the P&C agent did in the example above. This not only waste time, but can waste hundreds or thousands of dollars over the life of a policy.
But, with just a bit of knowledge and knowing which companies specialize in underwriting life insurance with health problems you can find the best rates.
With the answers to the questions above, a special risk life agent can speak to several underwriters about your situation. And once all the underwriters give their tentative offers, you will know exactly what companies will offer and how much the premiums will be.
When dealing with life insurance with health problems their is definitely an art to knowing how to find the best offer. Your job is to just find the experts.
Fortunately, you have landed on this page. We are experts at finding the most affordable life insurance with health problems.
Conclusion-
If you are in the market for business life insurance and have a history of pre-existing medical problems contact us for a free consultation. You can reach us at 1-888-393-9003 or mike@specialriskterm.com
