[The following is a guest post]
Getting declined for life insurance can be a thoroughly frustrating affair; especially when you truly don’t understand what it is that you did wrong with your application. Under most circumstances, it was some small oversight; even more frustrating right?
Here are 4 common reasons for life insurance application declines, how they can be avoided, and what you can do to make sure that you don’t make the same misstep on your next application. Don’t forget to click this link to find out about organizing your own life insurance.
1. You Didn’t Read Through the Exclusions
At the very least, you didn’t read through them well enough and the exclusions section is really the only fine print that matters when applying for a new life insurance policy. Even if this policy was one of those “no exam” type policies, there are still plenty of exclusions and typically an individual only goes for one of these policies if they have a certain medical condition. Well, guess what, the insurance company is still going to look into your medical history; regardless of if there’s an exam, or not.
Now, if you were matched to this policy by a life insurance agent, here’s the thing – you don’t want to use that agent again. Obviously, they just wanted to make a sale. Next time, make sure you go with an agent who’s not only reputable, but who doesn’t work for any one agency; these are the agents who really know the market and aren’t just a cog for their company.
Good Tip: Always call the insurance company after you send in an application and ask to speak with a representative who will skim over your application with you over the phone. They can catch anything that needs to be fixed, or anything that might not be covered, and you can fix it before that application is sent in, declined, and shows up as declined on your medical records.
2. You Omitted or Incorrectly Listed Something
This happens all the time and it’s a huge part of why enlisting the assistance of a life insurance specialist can be invaluable. After all, you don’t want to get declined for a reason like these:
- You left something blank
- You incorrectly answered a question
- You asked for too much coverage
- You incorrectly signed the application, or did so from another state
- You didn’t sign the application at all
- You didn’t put down a street address, but a P.O. Box number
As you can imagine, all of these are very easily avoided. Sometimes, all it takes is a trained eye; one that knows the typical missteps of an individual filling out a life insurance application for the first time on their own.
Good Tip: This is going to be the same tip. Simply call the insurance company and double check the application with them, or sit down with a life insurance specialist prior to sending anything in and let them go through it with you with a fine tooth comb.
3. Your Records Know Something You Don’t
Dun dun dun – this is always a scary one. There’s something showing up on your MIB records (Medical Insurance Bureau) that you’re unaware of, or it might very well be in your Pharmacy and/or MVR records. All of these are looked through by the insurance company, even if it’s a “no exam” policy. If anything at all doesn’t match up, you will be declined.
Good Tip: Before you fill anything out, order a copy of all records the insurance company is going to be looking at. Make sure you know everything and won’t be unintentionally putting down inaccurate information.
4. A Doctor Dropped the Ball
While doctors seem to be the utmost responsible of individuals, they have a lot going on and sometimes, things fall through the cracks. It’s very possible that your doctor didn’t provide the insurance company with the medical records they needed in time, and you were none the wiser. It’s also possible that there’s a discrepancy in your medical records due to doctor error.
Good Tip: Make sure that all of your doctors, with all of their contact information, are thoroughly listed on your application – if the insurance company is missing something, they can use this information to contact the doctor directly. Also, it certainly helps to call and check with the insurance company regularly during the application review process – if you can catch them before they slap a big ole’ rejection on your application, you might be able to save yourself a substantial amount of time and grief.