Cancer No Longer Means Automatic Decline

"This involves more time and energy on the advisor's part, but it greatly increases the chances of the client being accepted at a good rating," Terhorst says.

The planner also includes cancer considerations when reviewing or developing the client's estate plan. "Most people don't like contemplating their own death, and many people in their 30s and 40s don't even have an estate plan," he allows. But in view of the cancer, he says, "this must be considered."

Cvetanovski says it is important to let the underwriter know whether the cancer treatment has been completed. (This is in addition to including the details on the cancer itself and the treatment.)

Underwriters look for that, he says. In addition, they typically require a "postpone" period of six months to two or more years during which the client waits before making application for coverage.

In recent years, the required postpone periods have been getting shorter for certain cancers "because the treatments are getting so good," he says. Also, the aggressiveness of the carriers plays a role.

In discussing the process with clients, "you have to let the client know what is happening," Cvetanovski stresses. "Be upfront on everything."

For instance, he advises letting the client know that there is a higher risk to the carrier when accepting someone who has had cancer. Explain that this is why so many details are needed (type of cancer, treatment, stage and grade, follow-up status, medications if required, etc.), why there is a postpone period, and why the client may initially have to pay more (the flat extras), or be rated (pay more than standard rates).

Cancer clients tend to be very open, he says, and they are receptive to the process–if the explanation is clear; if they are applying for coverage because they need it, not because they feel fear about their cancer; and if the rate quoted is on the conservative side.

These clients are also very knowledgeable about their condition, says Robert Haran, vice president and chief underwriter for life risk management at MassMutual. "They know the stage and grade of their cancer, for instance."

Cancer clients also are aware of the radiology and chemotherapy treatments they have had and the importance of follow-up, says Daniel George, M.D., medical director of life risk management at MassMutual. "They know how often they see the oncologist. They know the results [of their treatment]….Also, sometimes they can get the pathology report and give it to the agent."

All of that, combined with input from agents who are educated about what to look for in cancer survivors, can give the carrier the details it needs, says Haran. "The better [more accurate and clear] the information is upfront, the closer the end result will be [to coverage as applied for]."

What types of information do underwriters need to evaluate the risks properly? The box shows many elements requested by Mutual of Omaha.

"Hopefully, we get everything we need from the application and the APS," says Michael Wilkins, M.D., who is vice president and medical director at Mutual of Omaha.

But if we need more information, we go back to the agent and client and say, "help us along."

It's very important to include the follow-up information, Wilkins says. "We want to see that the people do what the physician suggested, and we want to know that this is age and risk-factor appropriate."

The insurer also wants to be sure the cancer has not come back, he says. (For instance, breast cancers and melanomas do tend to recur, he says.)

Clients should not automatically assume a rejection, he stresses. "Companies vary in how aggressive they are in rating and underwriting for cancer."

A number of cancers can get favorable ratings, if detected and treated in the early stages, Wilkins notes. Examples he cites include cervical, breast, prostate and non-melanoma skin cancers. George, of MassMutual, adds prostate cancer to the list and even some invasive breast cancers, depending on size and other factors.

Also, some cancers can be rated standard, while others may be rated standard with a flat extra, with some flat extras declining over the period, says Wilkins.

George notes that some early-stage breast cancers that have not spread can even be written as preferred, depending on size and other factors.

Other cases are table-rated with a flat extra. But then, some carriers may take away the table rating after 10 years, says Wilkins.

Meanwhile, some universal life carriers are using a "smoothing" approach on contracts that have large upfront surcharges on top of the premium, says McAvoy. The effect is to create an even premium in all policy years.

"All of this is individual to the case and the company's underwriting rules," Wilkins sums up. Where the agent and client can make an impact is in the information supplied.

Producers do try to get the best deal for their client, points out MassMutual's Haran. So, they often will deal with multiple companies.

And some companies are very competitive on cancer cases they believe they can write, he says. "If we properly price the mortality, we want the business on our books."

So, the insured should not be discouraged, stresses McAvoy, the incoming chairman of NAILBA.

If the agent encounters difficulties, he adds, there are brokerage agencies that specialize in insuring people with medical conditions. "You just need to find one company that says 'yes.'"

Cvetanovski of Chesterfield, Mich., has reason to be cheered by these positive messages. He himself is a cancer survivor, having undergone surgery awhile back to remove a tumor related to testicular cancer. Right now, he is approaching the end of his postpone period, so he will soon be eligible to apply for life insurance.