If so, check out West Coast Life’s NEW Liberalized Underwriting Stance on MVRs & Moving Violations!

Did you know that West Coast Life recently liberalized there underwriting stance regarding
MVRs & moving violations?

While two moving violations will still qualify for preferred at best, your applicants can now have three before being offered standard.  You may wonder what a few speeding tickets have to do with your client’s mortality.

According to the National Highway Traffic Safety Administration, motor vehicle crashes are the leading cause of death for people of every age from 2 through 34. A DUI/DWI or reckless driving charge in the past five years is still standard at best.

Clients have apprehension about taking a medical examination for life insurance. The process provokes both anxiety and hesitation.  In addition, it is possible that improper client preparation could lead to avoidable poor underwriting decisions.

Preparing your clients as early as possible for their life insurance exam, will make the process easier for your clients, and improving their chance for a favorable underwriting outcome.

1. Morning Exam. If possible, Clients should schedule their examination in the morning. It is easier for clients to fast while they sleep, and blood pressure is typically at its lowest upon first waking.

2. Rest and Good Health. Clients should have adequate rest and be in good health for their medical examination. If a client is sick (even a cold) or exhausted, the exam should be rescheduled. Make sure that pregnant clients inform the examiner of their condition.

3. Nicotine Testing and Usage. Clients should not use any nicotine product for at least two hours prior to the examination. Clients will have their urine tested for nicotine. Clients do not have to be cigarette smokers to have nicotine discovered in their urine sample cigars, chewing tobacco, snuff, nicotine patch and gum can all cause nicotine to be detected. It is important that clients disclose to the medical examiner any nicotine products they are using. Failure to do so, combined with a discovery of nicotine in the urine, may suggest a lack of full disclosure.

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1. HEART DISEASE

Heart disease is the primary concern of underwriters, since cardiovascular disease is the number one killer of both woman and men.

ASK THE FOLLOWING QUESTIONS:

• Are you on Medication? If so, what and how much?
• Ever had a Stress Test? What are the results and date completed?
• Ever had a Heart Attack? When did it occur?
• Ever had Bypass Surgery? What was the date of the procedure?
• Ever had Angioplasty? What was the date of the procedure?
• What is your “Ejection Fraction?” (EF measures blood-flow, normal EF is 55% or greater. If 50% or less, it indicates some degree of dysfunction. The lower the percentage, the worse the prognosis. Clients with an EF of 35% or less would probably be declined, or highly rated. A low EF would be a difficult case to place, if able to be placed at all.)

2. DIABETES

3. CANCER

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ELIMINATE UNDERWRITNG DELAYS

Common areas often overlooked:

• Completing a signature everywhere a signature is asked.
• If a question is answered with a "yes," details regarding that question need to also be provided.
• Checks to make sure all dates on the application are the same.
• For example, First Colony will refund a check if the date on the check is different than the date on the conditional receipt.

2) Doctor Information that is often not included:

• Name
• Address
• Telephone number
• Date of last visit
• Reason for last visit

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1. CREATE A FLAWLESS COVER LETTER

Field Underwriting guide provide tips and instances when including a cover letter is crucial and/or necessary to the case, such as when:

• Dealing with large premium cases and/or face amounts greater than $1,000,000.
• When carriers are able to credit a low substandard case down to Standard because of an informative cover letter.
• Instances when the underwriters are able to offer a reduced rating, due to an informative cover letter which provided enough information to justify a decision.
• Times when a cover letter has made the difference between Standard and Preferred.

The importance of the cover letter is to answer questions up front and eliminate any chance for the underwriter to challenge the total line of coverage being requested.

More often than not, personal and business documents alone do not tell the full story of the loss that will be incurred by the beneficiary. Remember, your cover letter is what will give the underwriters information to help them understand the rationale for the sale, and make the most aggressive offer.

Key pieces of information all cover letters should include:

• How well you know the client and the client’s business.
• How the sale developed, and the purpose of the coverage (income replacement, key-person, buy-sell, estate preservation, etc.)
• How the plan of the insurance and face amount were determined.
• Assumptions or formulas used to determine the amount, along with copies of any financial planning documents.

Knowing the basic timeline prior to submitting a case allows you to set expectations, which gives you and your client a better idea of what to expect. Below is the process and timeline we utilize at Provada, which is fairly typical of well-run Brokerage General Agencies. The first part of this post is specific to life insurance policies while life settlement processing is discussed at the end.

APPLICATION SUMBISSION:

• Allow 4-6 weeks for a simple application.
• Most Brokerage General Agencies (BGAs) process applications within 24 hours of receipt.
• If medical records are required, allow for 2 additional weeks. This can vary depending on the applicant’s doctor’s ability to get the records out to the BGA.

UNDERWRITING REQUIREMENTS:

• Clients are typically contacted by the paramedical firm with 24 hours of the requirements being ordered.
• BGAs are typically updated weekly by the paramedical facility.
• Once the exam is completed, results are received within 5-7 working days.
• An average turn around time of 10-14 working days for medical records ordered from doctors and medical facilities.

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