Question: I am 45, I am overweight, I smoke and drink, work in a high-stress job and keep irregular hours, and do not have either a life or a health cover. Is it too late to buy them?
Answer: Life insurance companies categorize individuals under low and high risk category. Being overweight or a chain-smoker and a heavy drinker certainly puts you on a high-risk category as far as your life insurance in concerned. However, that does not mean, that you cannot acquire a life or a health cover.
Apart from the financial underwriting that largely decided how much of life cover can be given to an individual, all insurance companies have their own medical underwriting guidelines that help them to decide on the health profile of the individual. Some of the factors considered for placing a life on high or low risk health profile are height, weight, state of health, history of disease, amount of cover and the occupation. The insurer also carries out a series of medical tests to determine the health risks.
For all lives falling under the normal health category, the insurers cover the risk and the life protection is provided to the individual. However, the moment the risk appears to be high as per the insurer’s standards, the insurer resorts to asking higher premium from the individuals. This is called the ‘loading’, ‘rating’ or ‘extra-premium’, which the individual has to pay over and above the premium, which is paid by healthy-class of individuals.
In certain cases, the life protection is totally declined to the individual and the entire premium, is paid back to the individual. According to the defined benchmarks, the life of the individual is considered too risky and the insurer is reluctant to offer any level of protection to the individual.
However, that might not be the case always. The perceived medical factors like overweight should not be the reason for one to stay away from applying for life cover. Even a normal looking and healthy individual may be declined a protection if negative factors surface after the medical tests. Buying insurance when one is in the best of health is the right approach.
Disclose all material information about your health and let the insurer decide. Even if there is a ‘loading’ within manageable amount, go ahead and be insured. In case, the ‘loading’ is too high, lowering of the amount of life cover or even the term of the plan can be sought. In case of of health insurance, the insurer might as well ask you to undergo medical tests and submit reports. Also, the pre-existing diseases are never covered for the initial 2-4 years. Hence, company’s risk is reduced to that extent. It is certainly not too late for cutting down on weight and stop the use of tobacco for a better health, for you and your family.
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