How Non-Medical Factors Affect Life Insurance
Whether you’ve been searching for life insurance for a while or just started, understanding the different lifestyle factors that can affect your life insurance makes a big difference in how you can find the right cost-effective policy you need.
In this Article:
Application Process for Life Insurance
The process of obtaining life insurance is not as complex as you may think. Once you apply for a life insurance product or package you are interested in, the life insurance company sends the application to an underwriter. The underwriter reviews your application and will determine if you are eligible for a life insurance policy with them or not. Note that each life insurance company has their own unique guidelines that they must follow that will determine your rating based on different factors.
As the underwriter is reviewing your application, they will consider factors such as your:
- Age
- Gender
- Medical conditions
- Current wellbeing
- Family history
- Job and if you partake in any dangerous hobbies
- Driving record and/or criminal record
All these factors are used to help determine if your life insurance application gets approved or denied, or if there are exclusions needed. The underwriting determines this by calculating your risk factor – your risk factor is something a life insurance company calculates based on your wellbeing and lifestyle to determine your chance of passing away earlier than expected.
Typically, the more severe these factors are, the higher risk you bring to the life insurance company, which will either raise the cost of your life insurance policy or simply deny you the policy. In some cases, your application may be assessed on a case-by-case basis due to the severity, rarity, or uniqueness of the case.
Non-medical factors that affect life insurance
It may be obvious why medical factors such as your current and past medical health information. But there are other less obvious non-medical related factors that can impact your application process. Remember, that each company has their own guidelines that must be followed so each company can price you and deny you if they deem your lifestyle to be too dangerous to insure.
The most common non-medical factors that affect life insurance are:
- Dangerous Hobbies
- Risky/Hazardous jobs
- Driving History
- Criminal Record
- Foreign Travel History
Dangerous Hobby
Insurers will define dangerous hobbies as hobbies that have a higher chance of fatal injuries. These hobbies can include:
- Mountain, rock, or ice and snow climbing
- Motor vehicle racing
- Snow sports like skiing, snowboarding, and snowmobiling
- Skydiving
- Sport aviation
- Scuba diving
By participating in a hazardous activity, your life insurance company may ask you further questions to determine your preparation for the activity as well as what safety measures you take when participating in these activities. This will allow underwriters to determine your personal risk based on how often and how you participate in the activity. Some possible questions they may ask about the hazardous activity you participate include:
- The frequency of participating in the activity
- What type of activity is it and its own risk factor
- Your own experience in the activity
- If you are certified in the activity? eg: do you have a scuba diving certificate?
- Your personal medical history
- The location and terrain where you participate in the activity
Therefore, if you participate in any of these sports and activities, be sure to let your insurance advisor or the life insurance company know on your application. If you are unsure about a specific activity you participate in, contact us and we will help you find a product that fits your hobby and lifestyle.
Risky Job
The type of job you have can have an effect on your life insurance application as well. A dangerous job is a job that puts you at a higher risk to die earlier than others. As a result, your risk increases if your job exposes you to any danger.
Some dangerous jobs can include if you:
- Are in the military
- Are exposed to dangerous chemicals
- Travel to dangerous areas or countries for work
- Use or are exposed to firearms
- Work high off the ground
- Work underground
- Work with explosives
It is important to fill out this information on your application as accurately as possible. If you incorrectly fill out your application on the job section you may lose the death benefit in case you pass away, cancelling the policy you created to protect your family.
This also means to not put a job down that you don’t have, since the type of job you have will greatly affect if your life insurance policy is approved or denied as well as if your policy increases in cost to supplement the risk of the job.
Driving or Criminal Record
If you have an offense on your record like a DUI, then a life insurance company can take that as evidence that you are taking on additional risk that others don’t – making you have a higher chance to die before a certain age. Life insurance companies have found statistically that you are at higher risk to die earlier if you have offenses on your driving or criminal record.
Because driving to work is also very common, a life insurance company will look into your driving or criminal record to see how you treat yourself and others around you in order to determine if you, on average, bring out more risk than other people. It also depends on the kind of offense on your record. Your application could be taken as a case-by-case application giving extra attention to your application with possibly some flexibility in your application process.
Each type of driving offense on your record will affect your application and insurance differently. For example, insurers will not consider your application if your license is currently suspended. Or with driving infractions, some life insurers will rate you higher if you surpass a certain number and/or type of infractions.
Similarly, criminal records are also considered by life insurance companies. Insurers will automatically decline anyone on probation, in jail or awaiting trial, but will also ask for your criminal history from as little as 12 months ago to 5 or 10 years or an indefinite period.
Foreign Travel
If you are someone who travels often to foreign countries, then depending on your travel plans, your life insurance application may be delayed or even denied. A helpful resource is to look at the Government of Canada’s travel advice and advisories by destination. This information lets you and the company know what countries are considered as dangerous and should not be travelled to. If your destination is dangerous, your application may be declined.
A life insurance company will factor in information about your:
- Planned Travel Destination
- Travel History
- Purpose of Visit
- Length of Stay
So before travelling, it is also important to cross-check your destination with the Canadian Travel Advice and Advisories, as some life insurance companies will factor in the destination you travel to as well as the length of your stay. If you plan to travel and stay in the country for more than 6 months your application will be assessed on a case-by-case basis.
Frequently asked questions (FAQ)
Not everyone needs life insurance, life insurance is created for those who have financial obligations that they don’t want to leave any stress or obligations on anyone else in case they pass away. Life insurance is a great option for you if you have any debts, mortgage, dependents, or any type of financial responsibility that you are in charge of. Life insurance is to reassure your family that they will be protected in case you pass away.
The point of no medical life insurance is to avoid a medical exam and questioning. You will not be required to undergo any medical examination under this type of policy. No medical life insurance is useful if you have been denied a life insurance policy in the past due to medical conditions you may have.
Yes! No matter for what reason you have been denied life insurance previously, there is a life insurance policy out there for you. If you have been denied before, that’s okay too, you just need to find the right plan from the right company for yourself. Each company follows their own rules so it can be hard to figure out which company to use – but the trick is to use trial and error and to start by getting quotes from as many companies as possible! Contact us today to help you figure out the best life insurance package for you and your family’s needs.
Yes! No matter how severe your medical condition is, you can still get life insurance. There are many different types and companies that offer life insurance – and each company has their own unique guidelines that their underwriter follows. So each company and type of insurance follow their own rules that can make a huge difference in your application process. The easiest way to get the right life insurance policy for yourself is to contact us for an expert advisor to build and find the best life insurance package to suit you and your family’s needs!
Your current wellbeing and medical conditions you’ve had and currently have will be taken into account in your application process. Your family’s medical history is also used to determine if your application is approved or denied based on your risk factor.
Getting the life insurance that suit your needs
There are many factors that affect your life insurance application process, and on top of that, each company has its own guidelines that the underwriting follows for accepting and denying life insurance applications. The cheapest and easiest way to get yourself a life insurance policy for you and your family is to contact a life insurance broker. Here at PolicyLife, we can instantly compare multiple quotes for you from different companies at once – and our service is free!
Try using our Instant Insurance Quote tool now to compare prices of quotes from the top life insurance companies in Canada. PolicyLife provides life insurance packages, including term life, no-medical, and permanent life insurance for everyone in Ontario, British Columbia (B.C), and Alberta. Contact PolicyLife today or learn more by reading our blogs to learn how to get the best life insurance policy to best protect you and your family.
