By John Drachman
On the younger side of Gen X, the 43-year-old Chadwick Boseman’s passing from colon cancer last week was a sudden reminder to non-seniors of hazards beyond Covid-19. Known best for his starring role as King T’Challa in Marvel’s “Black Panther,” Mr. Boseman’s battle began with a pre-existing condition that had been diagnosed four years earlier, The Associated Press reported.
With the frailty of life on many minds, life insurance applications have risen steadily, according to the MIB Life Index. During the first half of 2020, application activity was 1.5% higher a year earlier. Applications for Americans younger than Mr. Boseman rose about 3.4% year-to-date, while activity for ages 45 to 59 climbed 0.5%.
Commenting on the role of insurance in our crisis-filled era, CFP™ Barbara Ginty recently told CNBC, “You don’t want a loved one to experience the tragedy of losing a loved one in addition to a financial tragedy. A financial tragedy is preventable.”
Pre-existing health conditions like heart disease, cancer, high blood pressure and diabetes don’t automatically mean you’ll be denied life insurance, but they can complicate the process. According to the Center for Medicare & Medicaid Services, one in two Americans has a pre-existing condition. If you’re one of them, it’s still possible to find a decent rate if you do your research. Know and document as much about your condition as possible. Reducing guesswork now will save time later.
With some pre-existing conditions, a traditional term life insurance option – which covers you for a specific amount of time – might be off the table. On the other hand, a graded benefit life insurance policy requires few health questions and no exams. Here the cost would be higher though and the payout structure might vary.
After completing the research and organizing your documents, take these next steps:
- Find an independent agent: Most people start by getting a referral from their financial advisor. Others search online for a local broker with expertise in particular conditions. By working with an independent agent, you are not limited by a single insurance carrier – and you can examine the range of policies available to you.
- Undergo the medical exam if possible: Better rates are available to those who complete the life insurance medical exam. Otherwise, the less a company knows about you, the more it charges to offset its risks.
- Talk to your physician: When a pre-existing condition is present, insurance underwriters will request a physician’s statement from your doctor concerning your medical history. Know what they’ll be sharing about you with insurers.
By investing time upfront, you’ll save money and effort down the line. Make sure you get quotes from several companies; this is even more important for higher-risk situations in which competing carriers assess your risk differently. The fact that your agent is independent will also ensure you’re getting unbiased help in your quest for a suitable plan that fits your needs.
John Drachman is a contributing writer to MyPerfectFinancialAdvisor the premier matchmaker between investors and advisors. John is an IABC award-winning writer, who applies his 30 years of financial marketing experience toward advancing the dialog between investors and investment professionals.