According to Virginia-based insurance executive Courtney Rogers, insurance is a matter of risk. The greater the risk of you dying soon, the higher you can expect a life insurance premium to be. In some cases of very high risk, your medical status can mean being denied life insurance altogether. In order to get approved for some life insurance policies, you may have to submit to a medical exam.
Why Test?
By submitting to a medical exam, you give the insurance company specific, up-to-date information about your medical circumstances. As an alternative to taking a guess based on your age, gender, zip code and ethnic background, this allows the insurance company to precisely calibrate your personal level of risk. Without this information, most companies will err on the side of expensive when calculating how much to charge you for life insurance.
Risk Thresholds
Most insurance companies have risk thresholds for their policies, beyond which they require a medical exam. For some companies, it's a matter of the dollar amount of the policy. For example, a company might require an exam for all policies over $100,000. For others, it will be tied to the circumstances of the applicant. A company might require a medical exam for people with a chronic illness, or for single people without children who buy insurance. If you are below the thresholds set by an insurance company, you might not have to take a medical examination.
Initial Questionnaire
The process of applying for life insurance includes completing a detailed questionnaire about your medical history. This is the first level of medical exam for the process, and is occasionally all that the company requires. Most insurance agents receive training so they can identify conditions or circumstances which might disqualify you or cause a hike in your rates.
Levels of Exam
There are many levels of medical examination insurance companies may want. At the least intrusive level, almost all policies require your permission to check your medical records. At the most intrusive, you can be asked to go to an insurance company doctor and submit to a full physical, complete with blood, stool and urine samples. Many interim levels also exist, ranging from a simple oral swab to confirm claims of nonsmoking, to drug tests, to an in-home nurse interview.
Consequences of the Exam
If the results of your exam match what you stated in the initial questionnaire, your insurance should be approved at the rate your agent quoted. If the results of your exam do not match your claims, one of two things will happen. If the discrepancy looks like an honest mistake, or the exam turned up a condition of which you were unaware, your life insurance rate will be adjusted to account for the correct information. If the company thinks you lied to cover up substantive information, they have the right to cancel your policy and refund your initial payment.
References
- "Exam Cram: Life and Health"; Bisys Education; 2006
- "Life Insurance and Its Applications"; Irena Kerr; 2001
- Courtney Rogers, Insurance Executive, Richmond, Virginia
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