Life Insurance Application: A Step-By-Step Guide To Filling It Out

Filling out a life insurance application is a crucial step in securing financial protection for your loved ones or business partners. Here's a comprehensive guide to help you through the process:

First, understand the two main types of life insurance: permanent life insurance, which provides coverage for your entire life, and term life insurance, which only covers a set period. Consider your needs and choose the type that suits you best.

Next, determine your coverage amount by evaluating factors like the age of your dependents, your spouse's earning ability, any outstanding debts, and your family's financial resources.

When filling out the application, be prepared to provide personal information such as your name, address, occupation, and employer. You will also need to disclose lifestyle habits (e.g., smoking, drinking, exercise), health histories of immediate family members, financial information (income and net worth), risky hobbies, and criminal convictions. It's essential to be truthful and accurate to avoid complications or denials in the future.

Additionally, you will need to name your life insurance beneficiaries, who will receive the death benefit if the policy pays out. You can assign different percentages of the benefit to each beneficiary and also name a secondary beneficiary.

The application process may include a medical exam, depending on the insurance company and the amount of coverage you're applying for. Be prepared for questions about your medical history, family medical history, current medications, drug and alcohol use, and criminal history.

Working with a life insurance broker or agent can be beneficial, as they can guide you through the application process, ensuring accuracy and completeness, which can expedite approval and potentially lower your premiums.

Personal information

• Basic Information: Provide your full name, date of birth, address, phone number, and social insurance or social security number. This forms the foundation of your application and helps the insurance company identify you.
• Marital Status: Include your current marital status. If you are married, you may also need to provide information about your spouse.
• Beneficiary Information: Name the person(s) you wish to receive the death benefit in the event of your passing. You can also name a contingent beneficiary, who would receive the benefit if the primary beneficiary is unable to. If you have minor children as beneficiaries, you may need to appoint a trustee to manage the funds.
• Contact Details: Ensure your contact information, including email and phone number, is up-to-date and accurate. This is crucial for the insurance company to be able to reach you and your beneficiaries if needed.
• Gender: Some applications may ask for your gender, as it can be a factor in assessing risk and determining premiums.
• Social Insurance or Social Security Number: This is an important identifier and helps the insurance company verify your identity.
• Date of Birth: Your age is a significant factor in determining life insurance rates, as younger individuals generally qualify for lower premiums.

Remember to review this information carefully before submitting your application. Working with an insurance agent or broker can also help ensure that your personal information is accurately represented and that you've provided all the necessary details.

Beneficiary information

This section of the life insurance application is where you name the person(s) you would like to receive the death benefit if the policy pays out. You can also name a contingent beneficiary and trustee for any beneficiaries who are minors.

You will need to provide the following information about your beneficiary:

• Full name
• Social Security Number
• Address
• Phone number
• Relationship to you

If you have multiple beneficiaries, you can assign different percentages of the benefit to each person. For example, you could assign 70% to your spouse and 30% to your brother.

You should also be prepared to designate a secondary beneficiary (known as a "contingent beneficiary"). This is the person who will receive the benefit if the primary beneficiary dies before you do.

In addition, the application will likely ask how often you want to be billed. Common choices include a single payment (one large lump sum) or monthly or annual payments. Keep in mind that the insurer might charge service fees to cover administrative costs if you choose a more frequent payment schedule.

Policy details

The "Policy Details" section of a life insurance application is where you specify the type of policy you are applying for, the desired death benefit amount, and the term length (if you are applying for term life insurance).

Type of Policy

The two main types of life insurance policies are permanent life insurance and term life insurance. Permanent life insurance provides coverage for your entire life, whereas term life insurance only covers a set period.

Death Benefit Amount

The death benefit is the sum of money that the beneficiaries will receive upon the death of the insured. When determining the amount, consider factors such as the age of your dependents, your spouse's earning ability, any outstanding debt, and your family's combined financial resources.

Term Length

If you are applying for term life insurance, you will need to specify the desired term length. Term life insurance policies typically have terms of 10, 15, 20, or more years. Consider how long you will need the coverage for when determining the term length.

Health information

The health information section of a life insurance application is one of the most important parts of the form. It is essential to provide accurate and complete information about your health and medical history. This includes disclosing any pre-existing health conditions, medications you are taking, and medical tests or treatments you have had or have scheduled. Be prepared to provide details such as dates, symptoms, diagnoses, and treatments for a range of medical conditions.

You will also be asked about your family's medical history, particularly your parents' and siblings' health. Know their history of any chronic diseases, such as heart disease, cancer, diabetes, or mental health disorders. The insurer is looking for early-onset diseases, so it is important to know the age of onset and death (if applicable) for any affected family members.

In addition to your personal and family medical history, the insurer will want to know about your lifestyle and habits. This includes questions about tobacco, alcohol, and drug use, as well as any risky hobbies or professions. Be prepared to disclose any criminal convictions, driving violations, or suspended licenses. The insurer may also ask about your travel history and plans.

It is crucial to be honest and transparent when providing health information. Omitting or misrepresenting health details could lead to the denial of your application or future complications. The insurer will verify the information you provide, and any inaccuracies could be considered insurance fraud.

Lifestyle information

When filling out a life insurance application, you will be asked to provide detailed information about your lifestyle. This is because insurance companies need to assess the amount of risk you pose and determine the right policy to meet your needs. Here are some of the lifestyle-related questions you can expect:

Lifestyle Habits

You will be asked about your lifestyle habits, including smoking, drinking, drug use, and exercise. Be prepared to disclose any prescription medications you are taking, including the full name of the medication, the dosage, and the frequency.

Risky Hobbies and Profession

The application will also inquire about any risky hobbies or professions you may have. This includes activities such as piloting a plane, rock climbing, scuba diving, skydiving, etc. If your job involves high-risk activities, be sure to mention that as well.

Driving Record

Your driving record is another important aspect of your lifestyle that insurance companies will want to know about. They will want to know if you have multiple reckless driving tickets or a DUI (Driving Under the Influence) on your record.

Criminal History

The life insurance application will typically ask about any criminal convictions, particularly moving violations or a suspended driver's license. Be prepared to provide dates for any convictions, as insurers are generally only interested in events from a certain time period, such as the past five years.

Travel

The application will also ask about your travel history and plans. They will want to know if you have recently travelled outside the country or plan to do so in the next year or two.

Remember, it is crucial to be completely honest when providing lifestyle information on a life insurance application. Misrepresenting or omitting information could invalidate your policy or result in a denial of benefits later on.

Frequently asked questions