life insurance

How to handle the situation if you do not qualify for life insurance

If you’re trying to protect your family, hitting a roadblock couldn’t possibly be more frustrating, could it? The experience is similar to obtaining life insurance, only to find out your application was unsuccessful. Would you have any idea what to do if this were to happen? 

Do not fret: If your life insurance application fails, there are still options available to you. It is just as simple as knowing where to go next.

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It is enough to cause concern for anyone – especially if you have dependents who depend on your income – when that letter from the life insurance company states: “We’re sorry, but..”. Consequently, if this happens to you, you should first contact your insurance company or agent to understand better how it happened.

You must submit both medical and nonmedical risks during the application process to an insurance company. Some people drop their life insurance for various reasons (from severe medical conditions like heart disease to nonmedical issues such as bankruptcy, a criminal record, a positive drug test, and even dangerous hobbies).

Examine your case

You will be in the best position to determine if their claims are accurate when you know the reasons why because nobody understands the situation better than you do! Any information they provided back that doesn’t look up-to-date, inaccurate, or understandable is eligible for appeal.

It is possible to appeal a denial because the information provided to the insurer is incorrect or insufficient. Ask your doctor if they can provide your insurance company with as much accurate information from your medical file as possible, as this will help them process your claim more quickly.   

A non-medical reason can also be appealed, including a lapsed driving offense or an incorrect occupation and hobby description that would put you at high risk.

Consult with Your Workplace

Your life insurance application may fail if it appears that your employer is not working with you. Consider signing up for group coverage through your workplace.

Generally speaking, you won’t be able to get the full 10–12 times your income coverage we recommend, but it will at least provide a death benefit until you can purchase your term life insurance later on.

You usually don’t have to pay for a group plan, either. Adding to it will cost more if you wish to increase the payout. You can add to your group plan when you need additional coverage and don’t have other options. If your company benefits representative offers you extra “riders,” don’t get them – they are not worth the expense!  

There is no medical exam needed for your workplace life insurance plan, so you might be able to get coverage quickly. Remember: if you quit your job, your health insurance will end.

Get in touch with an agent for life insurance.

Get an expert on the job if you haven’t done so already! The expertise of an independent life insurance agent can be lifesaving in these difficult times.

An agent knows everything about the application process for life insurance (all the back-end stuff that determines if your application is approved or denied).

An agent should be capable of detecting and resolving any red flags in your application that might have led to your initial denial. It’s important to note that just because one company has refused your application, it doesn’t mean all insurance companies will as well.

Agents search across much larger markets to find you the best policy, not just what’s available online on your own (and hoping you can find a company that accepts you). You will also receive advice on any next steps you may need to take, which in some cases might include waiting a few months before applying.

You should allow time for a waiting period.

You may have to wait a while when you don’t qualify for life insurance to correct any health issues that may have contributed to the denial. If you need to lose weight or reduce your cholesterol or blood pressure, now is a good time to do it. 

Next time around, you could make a big difference if you maintain healthy habits (like eating healthy, quitting smoking, and exercising regularly). Keep trying! Changing what you can change is the best way to improve your life.

It might also be helpful to allow time to pass for nonmedical reasons for denial as well-like letting those multiple speeding tickets lapse. The next time you apply, a short break could be just what you need.    

If you’re in the waiting period, build an emergency fund during that time. You will have more peace of mind when searching for life insurance if you can save more money.

It can seem like everything is against you at a time like this, but if you make a few minor changes while you wait, you’ll be much better able to move forward. 

Change your policy and reapply.

There are no medical exam life insurance plans you can enroll in if you have a difficult situation, and alternatives (like your employer-offered life insurance) are not available. They will still ask you all the same questions regarding your medical history.

Even if you’re uninsurable, you can still get coverage—and not having coverage is preferable to being uninsured. However, you should always consult an insurance agent to determine the best option for you before applying.