Life Insurance: Defining Good Health And Its Benefits

Life insurance health classifications are used by insurers to determine whether to offer coverage and what premium to charge. These classifications are based on an individual's current health, medical history, family history, lifestyle habits, and other factors. The insurance company will review an applicant's materials and assign them to a risk class, which impacts their eligibility for coverage and the premium they will pay. While the specific classifications vary by company, they generally include categories such as Preferred Plus, Preferred, Standard Plus, and Standard, with Preferred Plus being the lowest-risk category. An individual's health classification is an important factor in determining their life insurance premium, with those in lower-risk categories typically paying lower premiums.

Height-to-weight ratio

When it comes to life insurance, health is a major factor in the underwriting process, and this includes a close look at your height and weight. Insurers use your height-to-weight ratio, often calculated as Body Mass Index (BMI), to evaluate your health risks and determine your rate class and premium costs. A normal" BMI range is associated with the lowest risk, while higher BMIs may suggest elevated health risks that result in higher premiums.

Each insurance company has its own build chart and health classifications, but they generally fall into four classes: Preferred Plus, Preferred, Standard Plus, and Standard. These classes are determined by your age, current health, past medical history, and lifestyle choices. For example, to be in the Preferred Plus category, you would need to be within the height and weight guidelines, have no poor health history, not be taking any medications, and have no family history of diseases. Only about 5% of people qualify for this class.

The Preferred category is for those in excellent health with a few minor health issues, such as controlled cholesterol, and within the height and weight guidelines. You may have a family history of cancer or other diseases and participate in dangerous occupations or risky sports.

The Standard Plus category is for those considered to be in better than average health but with minor health issues and possibly slightly over the height and weight guidelines. There is no family history of diseases for those in this category.

The Standard category is for those of average health who take multiple medications, do not meet the height and weight guidelines, and may have a family history of cancer or other diseases.

While BMI is a widely used metric, it is not the only factor insurers consider. They also look at medical history, family history, and lifestyle choices. Insurers also scrutinize how weight is distributed across the body, as certain patterns like abdominal weight can be indicative of higher health risks.

If your height-to-weight ratio suggests high premiums, adopting a healthier lifestyle may lead to lower rates. Regular exercise and a balanced diet can contribute to better health, which may be positively reflected in policy reassessments. Some insurers offer incentives or lower rates for policyholders who demonstrate health improvements.

Tobacco, alcohol, and drug use

Tobacco Use

Life insurance companies consider tobacco use a proven health risk, and smokers are generally classified as high-risk applicants. This classification is based on the well-established link between tobacco and serious health issues, such as heart disease and cancer, which can reduce life expectancy. As a result, tobacco users often face higher life insurance premiums than non-smokers, sometimes even double or triple the standard rates.

When applying for life insurance, it's essential to disclose your smoking habits honestly. Misrepresenting your tobacco use may be considered insurance fraud and can lead to policy cancellation or denial of claims. Insurance companies typically ask about your smoking status and may require a medical exam, including nicotine tests, to verify your tobacco use.

The definition of "smoker" can vary among insurers. Some consider any use of cigarettes, cigars, e-cigarettes, vapes, or chewing tobacco as smoking. Others may differentiate between occasional and frequent users, with occasional cigar or tobacco chewers sometimes classified as non-smokers. It's important to note that smoking cessation products, like nicotine patches or gum, can also lead to a smoker classification due to the presence of nicotine in the body.

If you're trying to quit smoking, it's advisable to purchase life insurance during this process rather than waiting until you've quit completely. This is because your premium will increase with age, and you might discover smoking-related health issues that further raise your rates or result in a denied application. Term life insurance can be a good option during this transition, as it can be cancelled without fees once you qualify for non-smoker rates.

Alcohol Consumption

Casual drinkers typically don't face significant issues when applying for life insurance. However, heavy alcohol consumption, as defined by about five drinks per day, can raise red flags for insurers. Heavy drinkers may be denied coverage or face higher premiums due to the potential health risks associated with excessive alcohol use.

To assess alcohol consumption, insurance companies often include blood and urine tests as part of the medical exam during the application process. These tests can detect signs of heavy alcohol use, such as carbohydrate-deficient transferrin (CDT), which is a common biomarker.

Drug Use

Life insurance companies generally differentiate between casual drug users and those with a history of substance abuse. People who use illegal drugs or have a documented history of drug addiction will likely be denied coverage or face higher premiums due to the potential for relapse and associated health risks.

For illegal drug users, most insurers require a period of abstinence before offering traditional coverage. This period can vary, typically ranging from two to ten years, depending on the insurer and the substance involved. For example, current users of psychedelics may need to wait at least two to three years before applying for traditional life insurance with most companies.

On the other hand, casual marijuana users, especially those consuming it in non-smoking forms, generally face fewer challenges in obtaining life insurance. However, insurers consider various factors when evaluating marijuana use, including legality in the applicant's state, medical card status, frequency of use, and method of consumption.

Recommendations for Substance Users

If you're a current or former substance user, it's important to be honest during the life insurance application process. Misrepresenting your substance use could lead to insurance fraud, which can have serious consequences. Additionally, working with an independent insurance broker can be beneficial in finding the right company and policy for your specific circumstances.

Blood pressure

Life insurance companies typically use two numbers to measure blood pressure: systolic pressure and diastolic pressure. Systolic pressure, the top number in a blood pressure reading, indicates the pressure in your arteries when your heart beats. Diastolic pressure, the bottom number, indicates the pressure in your arteries when your heart rests between beats. A baseline blood pressure reading is usually around 120/80 mmHg, and a high blood pressure reading is often considered to be consistently above 140/90 mmHg. However, this can vary based on individual health conditions and other factors.

Insurers will consider the severity of your high blood pressure and how consistently you manage it. They will look at your recent readings and any related conditions, such as diabetes or heart disease. Regular check-ups, medication, and a healthy lifestyle can positively influence your premiums. Managing your blood pressure through these means may reduce your risk by lowering your reading and demonstrating to the insurer that you are taking steps to control the condition.

Additionally, age plays a role in the impact of high blood pressure on premiums. The age of the first diagnosis may be a factor, as a later diagnosis may suggest a less severe condition and a shorter duration of managing high blood pressure. This could potentially reduce the time for serious health consequences to develop.

It is important to note that having high blood pressure does not automatically result in high insurance premiums. Life insurance companies have different policies and rates, and by comparing different insurers, you can find the one that suits your needs. Being transparent about your health information and choosing an experienced insurer who can handle high-risk conditions are also crucial steps in obtaining the right coverage.

Cholesterol

• Low-density lipoprotein (LDL) cholesterol, also known as "bad cholesterol", can build up on the walls of your arteries.
• High-density lipoprotein (HDL) cholesterol, also known as "good cholesterol", helps to eliminate excess LDL cholesterol by carrying it back to the liver.
• Very-low-density lipoprotein (VLDL) is another type of LDL cholesterol that is considered "bad" and can also build up on artery walls.

High levels of LDL cholesterol can lead to a buildup of fatty deposits, forming a sticky substance called plaque, which can reduce blood flow through your arteries. This condition is known as atherosclerosis and can lead to serious health complications, including coronary artery disease (CAD), heart attack, and stroke.

To maintain good health and reduce the risk of these complications, it is important to keep your cholesterol levels within the healthy range. The desirable total cholesterol level is below 200 mg/dL, with LDL cholesterol levels below 130 mg/dL and HDL cholesterol levels above 40 mg/dL for men and 50 mg/dL for women.

When it comes to life insurance, high cholesterol may impact your premiums or even result in a declined application. Insurance companies evaluate the potential risk of insuring you, and high cholesterol is considered a risk factor as it increases the chances of heart attacks and strokes, which are leading causes of death. If your cholesterol levels are particularly high or uncontrolled with medication, you may be denied coverage or charged higher premiums.

However, it's important to note that cholesterol is just one factor among many that insurance companies consider. They also take into account your age, medical history, hobbies, and other lifestyle choices when determining your health classification and premiums. Additionally, not all life insurance companies require blood tests or medical exams, and some may offer guaranteed issue life insurance, which does not require a health check but tends to have higher premiums and lower coverage limits.

If you are concerned about the impact of your cholesterol levels on life insurance, it is advisable to make healthy lifestyle changes, such as improving your diet and increasing physical activity, to lower your cholesterol and potentially improve your health classification.

Driving record

A good driving record is an important factor in getting good rates for your life insurance policy. Reckless drivers are considered a higher risk for life insurance, and driving offences can increase your premium.

Your driving record is a key part of your insurance health classification. This is a category that insurers use to determine whether to cover you and what premium you'll pay. Insurers will look at your driving record to assess your risk level, and how long they expect you to live. A clean driving record will help you get a lower-risk health classification, which will result in lower premiums.

Multiple moving violations will lead to a lower life insurance risk classification and higher rates. A driving while intoxicated (DWI) or driving under the influence (DUI) conviction within the last five years will result in a declined application. Reckless driving or certain types of license suspensions can also land you in a lower class.

Insurers will also want to know more about any dangerous hobbies you have, and your occupation. If the insurer thinks these pose a big risk, they may add a flat extra fee to your policy. This could be an additional premium for every $1,000 of coverage you have.

Frequently asked questions