January 14, 2013
By Rita Colorito, InsWeb.com
New Year’s health resolutions not only help you drop a pant size. They also can help lower your life insurance premiums, whether you’re looking to buy life insurance or already have it.
“Consumers could save 50 percent on their (life insurance) rates just by getting themselves in shape,” says Brian Ashe, treasurer of the nonprofit Life and Health Insurance Foundation for Education (LIFE).
Make these seven resolutions to get preventable health risks under control and save on life insurance.
1. Ask about price.
Before applying for coverage, ask your life insurance agent or company how much you’ll likely pay, given your current health status.
You don’t know whether you’re going to qualify for the cheapest rates until you actually answer medical questions or undergo a medical exam, Ashe says. A preliminary inquiry can help identify health changes you can make that may reduce your premiums once you apply for coverage. It also provides an opportunity to fix errors in your medical files that may bump up your rate.
2. Quit smoking.
Smoking remains the top controllable health risk that raises life insurance premiums, experts say. “If you are a smoker, the cost of premiums is two times or more than standard rates,” says Tom Harris, vice president of life and health for Country Life Insurance.
But you aren’t stuck paying the smoker’s rate forever if you decide to quit. For example, Country Life will consider a reduction in your premiums if you remain smoke-free for 12 months. Some insurers require you to be smoke-free for two or three years before you’ll qualify for the non-tobacco rate.
Harris recommends that smokers look into life insurance policies that offer options like these, rather than “taking the first available policy that you qualify for.”
3. Balance your BMI.
Obesity is second only to smoking as a factor that will boost your life insurance premiums.
Being overweight or obese often places you into a “rated” class, a calculation that raises your premium based on how much you’re over the ideal weight for your age and gender. “Those rates are going to increase by about 25 percent over the standard rate,” Ashe says.
Make sure your doctor accurately measures your body mass index (BMI). Even keeping your shoes on during a weigh-in can make a difference, as having an above-average BMI can lead to a policyholder paying up to 40 percent more than a preferred policyholder.
If your BMI ratio is outside the norm — say, if you’re a bodybuilder — you’ll have to prove your body fat is in the healthy range.
If you’ve resolved to lose weight, you don’t need to wait to get life insurance at a better rate. The Wellness for Life rider, offered by life insurer Aviva, provides premium discounts for maintaining or improving your weight. The policyholder pays a one-time fee of $100 and must visit his doctor every two years for a physical exam.
“The focus of the program isn’t on weight loss,” says Kent Major, vice president and chief underwriter at Aviva. Rather, he says, the focus is on improving your weight to keep it within a healthy range. Rates won’t rise if you gain weight, but can be reduced if your weight is maintained or lost. “It’s a cumulative effect over the life of the policy,” Major says.
4. Limit your alcohol intake.
All things being equal — you don’t have a history of DUIs or any heart or liver damage – one or two alcoholic beverages a day won’t hurt your premiums, but anything more may give you a financial hangover. Three to four drinks a day might still qualify you for standard rates, but that drinking level might raise some flags, says Ray Dinstel, chief underwriter at Genworth Life Insurance.
“With five to seven drinks a day, that alone would indicate cause for concern and premiums could go as high as three times more than normal,” Dinstel says.
Alcohol abuse can’t be fudged. A urine specimen submitted as part of a medical exam will pick up elevated liver enzymes, which indicate liver damage. Underwriters also will look at motor vehicle records and your doctor’s assessment of your alcohol consumption.
An alcoholic who continues to drink would be denied coverage, Dinstel says, but a recovering alcoholic who’s been sober for at least two years would be insurable.
5. Lower your cholesterol and blood pressure.
High cholesterol and high blood pressure are predictors of heart disease and other serious ailments, so the better these readings, the better your rates.
“A preferred rate would be offered to someone who has very good cholesterol, typically 235 or 230 or below,” Ashe says. People with these cholesterol levels could pay premiums that are 30 percent to 40 percent lower than a standard rate for a person who’s the same age and gender.
Insurers want healthy cholesterol and blood pressure levels for at least one year before they’ll consider that you’ve made a permanent change.
6. Ace the medical exam.
Medical exams conducted by doctors or nurses under contract with the insurance company often are part of the underwriting process. An exam typically includes blood and urine tests, and sometimes a mobile EKG reading if heart issues are a concern. To make sure the readings accurately reflect your health, follow these rules:
• Fast for 12 hours ahead of time.
• Don’t drink any alcohol for 24 hours before the exam. Alcohol can cause your heart to beat irregularly.
• Avoid strenuous exercise for 24 hours ahead of time. It may elevate your liver enzymes.
• Get a good night’s sleep.
• Try to schedule your exam in the morning, since protein levels are higher at the end of the day than at the beginning. A higher reading is linked to health issues such as kidney or liver damage.
7. Seek a reconsideration.
Even if you’ve already purchased life insurance coverage, it’s not too late to reap the benefits of becoming healthier. Once you’ve made positive health changes for a year or more, you can ask your insurance provider for to reconsider your rate.
The insurance company will check to make sure other elements of your health profile didn’t change for the worse, Ashe says. “They can’t take away benefits you’ve already qualified for, even if you’ve had a change in your health in a negative direction,” he says.
If you’ve stopped smoking or your health otherwise changes for the better, you often can qualify for a significantly lower premium.