Death is part of life, but since it’s such a sensitive subject, most people prefer not to think about it. However, the sudden loss of a family member—especially the breadwinner—can send a family into a dwindling financial spiral. Preparing for the financial aspect of death by purchasing a life insurance plan is one of the most responsible things a person can do. Life insurance provides financial support for families and loved ones after the death of the insured person.
Unfortunately, there are factors that may prevent a person from obtaining life insurance. Here are a couple factors that could lead to denial of coverage:
Cancer, heart disease and severe mental-nervous disorders are a few pre-existing conditions that could potentially get you disqualified for life insurance. When insurance companies put any of these conditions under a microscope, they see an individual who is less likely to live as long as someone without the condition. An individual with heart disease, for example, is more prone to have a fatal heart attack. However, don’t assume that these are automatic disqualifications—many cancer patients can be insured depending on the stage of their cancer and whether it was diagnosed early enough or not.
Alcohol is another factor that could disqualify you from life insurance coverage. This doesn’t pertain to the casual drinker, but the chronic user who shows signs of deteriorating health, including liver failure. Insurance companies are also unlikely to cover heavy drinkers since alcoholics are more prone to engage in behaviors that put others at risk in addition to themselves (e.g. drunk or impaired driving). Insurance companies can determine whether you’re a heavy drinker through analyzing results of medical exams—a prerequisite for obtaining coverage—and looking for symptoms like liver damage and high blood pressure.
Providers will also look at your driving record, and will raise premiums (or possibly decline coverage) if they find DUIs in your history.
Insurance companies will deny coverage based on severity of depression. Providers see depression as an existing condition—much like blood pressure—and provide coverage based on the risk. If you have had a history of suicidal actions, insurance companies will likely deny coverage due to the high risk. People who suffer from posttraumatic stress disorder (PTSD) may also be denied coverage. Another disqualifying condition would be self-medicating with drugs and alcohol to treat your depression.
Insurance companies may deny you life insurance coverage for engaging in extreme activities like skydiving, base-jumping and scuba diving. These and any sport that poses an unusual amount of risk will be a warning sign for insurance companies. Although it may seem like an easy thing to hide in your application, providers can look at your medical history and see if you’ve been treated for injuries related to extreme sports. Also, remember that there is a period of contestability in all policies. So, if you die in a sports-related accident a provider can deny coverage based on untruthful information on your application.
Although the above factors may make it more difficult to obtain life insurance coverage, every life insurance company is different. It’s important to do your research and compare life insurance quotes to find out which companies will insure you, and at what rate. Get started today by using our tool to request a quote online.