Are you entering retirement under-insured? If the only life insurance you carry is FEGLI term life then the answer may be a resounding: yes! Since your income is significantly higher when you’re close to retirement, your FEGLI coverage may not be enough for your spouse to maintain the lifestyle you’ve built together once you’re gone. Before you shop around for a policy in the private sector, it helps to know what to expect.
How Life Insurance Underwriters Determine Risk
When you apply for an individual life insurance policy, underwriters use a software program to calculate your mortality risk. This helps them determine if you can be categorized as one of the following:
- Preferred: best premium rates
- Standard: average premiums
- Rated: higher than average premiums
“Since products that contain nicotine potentially cause chronic health conditions when we’re older, smoking or vaping can result in higher premiums.“
Factors That Impact The Cost Of Premiums
In addition to the type of policy you’re applying for, underwriters consider certain factors:
- Your Age & Gender: The younger you are, the lower your premium and since women generally live longer than men their premiums are usually lower.
- The Health History Of You & Your Family: When you have certain health conditions, your premiums will be higher and heredity health issues like high blood pressure, diabetes or cancer in your family will also impact the cost.
- Cigarette Smoking or Vaping: Since products that contain nicotine potentially cause chronic health conditions when we’re older, smoking or vaping can result in higher premiums.
- Other Lifestyle Factors: Excessive use of alcohol, lack of exercise, or dangerous hobbies like rock climbing or skydiving will have a negative effect on your insurance application.
- The Coverage Amount: Underwriters look closely at the amount of coverage you’ve applied for to see how it relates to your income.
Prepare For Your Health Exam
More often than not the insurance company will arrange for a nurse or physician’s assistant to take your height, weight, blood pressure, plus blood and urine samples. Depending on your age, you may have to get an electrocardiogram or stress test. You’ll also be asked to sign a release for your health records.
Schedule your exam for the morning when blood pressure and heart rates are usually lower and get plenty of rest the night before. If you’re not feeling well on the day of the exam, reschedule it. Also consider fasting for at least eight hours to help ensure an accurate reading of your glucose and cholesterol levels.
Before you purchase a policy, connect with an FRC® trained advisor who can recommend insurers most likely to cover you at a reasonable rate.
