One of the most gratifying services a life insurance professional can provide is to secure underwriting successfully for someone who has been through difficult medical experiences and perhaps has even given up on their insurability. These cases can be financially rewarding as well.
But how to navigate the impaired risk case through medical underwriting? Here are 11 key secrets:
1. Summarize and cover the data. If the case is likely to be a substandard risk due to a prior medical condition, address it with a cover letter and a one-page brief that describes the specific case history. Data presented professionally, directly and efficiently makes it easier for an underwriter to come to a positive decision.
2. Give a target. Run illustrations in advance of medical underwriting. If it appears that the case must receive a specific underwriting category to get completed, be prepared to let the underwriter know what medical offer is necessary before submitting the case. This saves the underwriters time (which they appreciate). More importantly, the power of suggestion is a subtle beginning to negotiation with the carriers.
3. Create a generic informal inquiry. Create one combined application for use with your most frequently used insurers. This makes it possible to solicit several preliminary offers at once, and limits the nuisance the client would experience if having to sign over and over with each company approached.
4. Control the information flow. Handle the coordination of medical exams and application paperwork expeditiously. Gather all attending physician statements directly from the client's doctors. Make a visit to doctor's offices that are uncooperative by telephone or unresponsive to requests for records. Once all APS and medical exam information is in hand, share it with multiple companies at once. Possessing all of the records, you are in control of the search for the best carrier.
5. Know the products. For instance, guaranteed universal life insurance can often be a substitute for term life. Reinsured heavily to keep costs down, insurance company underwriters' hands are tied with term insurance by reinsurance treaties that create rigid underwriting standards and leave little room for underwriters to make compromises. Equipped with this knowledge, get underwriting quotes for term and permanent coverages. If the applicant can get standard underwriting for no-lapse UL and a Table 2 for term, it is very likely that the no-lapse UL will offer more value than the term policy to guarantee the same time period.
6. Find the hungry carrier. Life insurers are businesses like any other. They have cycles of greater and lesser appetite for new business based on corporate, personnel, market and industry issues. Take advantage of these cycles for clients. For instance, when a company is motivated to obtain new business, bring cases back into underwriting that may have been declined or rated. And remember, new product launches are often a time when insurers push for new sales.
