I was Approved for a Different Life Insurance Rate Class

Life Insurance

Were you approved for life insurance at a rate classification other than the one you were originally quoted? You may have gotten a term life quote for yourself and were comfortable with the death benefit, the level term period and the quoted premium based on the rating class you selected. Your PivotCare team member even asked you a number of health and lifestyle related questions. You both agreed the rating class you selected could be the possible rating class you could be approved for. So why did the carrier approve you at a different rate, and what are your options?

There are a number of rating classes that life insurance products can be issued for that could result in significantly different premium amounts. A life insurance quote helps you get an educated feel for what a carrier would likely approve you for. This helps with showing how much, if approved, the life insurance policy may cost. By contrast, an approval from a carrier is based on a full review of all the relevant health and lifestyle information provided. If quoted correctly, there should not be much of a difference between the rating class quoted and the rating class the carrier approved. Even when there is a difference – good or bad – you still have options.

An approval offer may result in a more favorable rating class than the quoted rating class. In this case, you may request either (or both) an increase in the death benefit or a longer term period subject to the insurance carrier acceptance. Of course, you may accept the approval offer of the original plan applied for and recognize the lower premium than the quoted premium.

An approval offer other than applied for, may result in a less favorable rating class creating a higher premium than the quoted premium. You can then request either (or both) a decrease in the death benefit or a shorter term period. Or you may accept the approval offer from the insurance carrier based on the original plan applied for and pay the increased premium.

About the author: Ken Buccico holds a LUTC designation and has been in the life insurance business for 39 years. His wealth of experience empowers clients to make best possible decision regarding a life insurance policy. To explore the best  life insurance option, contact Ken at 1-800-651-1953 or KBuccico@Pivot.com.