Types of High Risk Life Insurance and How to Choose the Best

The dangers could be accident, auto wreck, illness, and others. Those dangers can damage people's life. The bad part is the dangers cannot be predicted. They can come suddenly as people have not been prepared before. A businessman or even a taxi driver gets an auto wreck right after he is riding to his home. He is soon hospitalized for the wound, but how about the cost? It is better if the money has been prepared before. What will he do if he gets bad injuries and he has to spend a lot of money for the treatment? His money is not sufficient to cover the payment. It is pretty bad, isn't it? It is important to have the best preparation with high risk life insurance.

What is High Risk Life Insurance?

The term high risk refers to the increasing of passing away risk. It is sooner and faster than the average lifespan. It can be labeled to a person with health, lifestyle or condition. So, it becomes a factor that makes people consider to obtain a policy for high risk life insurance.

Besides dedicating for health, high risk life insurance is dedicated to those who often do or perform high risk activity likes the pilot, long trip driver, soldiers, and others. People cannot avoid the accident that may happen when they do their high risk activity. Let's take a look at a pilot's case. Life insurance for high risk can cover the fee the family to pay when their family member who works as the pilot gets into an accident. At least the burden can be lowered.

This life insurance has the same principle with the other kind of life insurance. The policy holder will pay a premium for death benefit protection in return. The policy holder pays the savings component and a cash value (it depends on the type of policy which is purchased). The underwritten policy makes high threat life insurance different from the other type of life insurance. The policy holder may use a different guideline as a certain insurance company. It uses a particular underwriting, set as the coverage applicant is being reviewed. An insurer or policy holder may decline someone with his preexisting condition. The others accepts him.

Term Coverage and Permanent Coverage

There are two options you can choose with this kind of insurance. They are term coverage and permanent coverage. Each of them is different based on the need of customers. The policy depends on the specific requirements and the particular risk you are insured for. Term insurance offers you the protection of pure death benefit. It doesn't save components or cash value. This coverage is mentioned as the basic coverage of LSI. That is the reason why term insurance is cheaper than the permanent one.

Permanent high risk life insurance combines cash value build up and the death benefit protection. The price is higher than term insurance as you will have to pay the premium payment. The policy can be kept essentially. A tax deferred basis becomes the base where the cash value grows. You can either withdraw or borrow the cash anytime you need. If the insured passes away, the unpaid balance in cash account will be charged against the benefit of death.

How to Choose High Risk Life Insurance

As there are many insurance companies, it will be pretty hard to choose and decide on which company you will rely on. There are some matters you can consider and think before you choose the life insurance to cover your payment. Let's take a look at the first matter. That is experience. It is much recommended to choose the life insurance agent or company that is experienced with your risk. Each of life insurance agent or company has their own perspective to look at your risk.

The perspective may be different to each other. You can ask the insurance agent or company. You are currently working with, whether they have any relation to the specialist of LSI. If they do, it will be very helpful. If they don't, you can look for or search it on the internet. Soon, you will find some result. Life insurance for high risk which excels your risk. It will be easier to decide. Consider their offer, quality and service.

Demonstrate compliance and control is a must to do for the chronic medical issues such as arthritis, diabetes, asthma, and the others that you may have. Control means there is no other major complications. Compliance means you follow the doctor's recommendation. The other thing to prepare for high risk life insurance is your medical documents. You may be asked for the proof of your medical record like blood pressure, cholesterol, triglycerides or a1c level. Make sure that all medical records shown is still in normal limit. There is a possibility that you may be declined or highly rated. It is okay to return and reapply the record when you get the normal limits.

Prequalification Service

There is a process named prequalification service. Your risk may be sent to several companies even the formal application of high risk life insurance is not completed. You can expect the offers and service. You may get from some different life insurance companies. Here are some requirements of this service. As the first step, your insurance agents or companies will gather your detailed health record and information. They will write some summaries for the underwriters before they send it to any life insurance for high threat carrier. The life insurance carriers, afterwards, will consider the risk based on the health information and record.

Secondly, your health record and information will be reviewed by the life insurance companies. They will send you the written tentative offers. You can expect some rates as long as the things are disclosed and there is no change. Based on the tentative offers, you can choose and decide the best services and products which are offered by some high risk life insurance. As you have the decision, you can apply the company in a formal way. Your application will be attached to the tentative offer with your high threat life insurance agent.

It is very common that people are not able to qualify for coverage. It becomes such a misconception. The coverage which is affordable is obtainable. The agents of high risk life insurance can do this matter. They may have some expertise to qualify the life insurance coverage with health impairments. As long as the agents are working hard, this important coverage will be secured. It would be better if you always secure the coverage as you are still young and healthy as the health is not always promised.

How Much Extra Are You Paying For You Health Condition?Or The story of Sarah and Sue

........and could you be paying less??

If you have a significant health condition such as diabetes or heart disease and your application for life insurance is accepted, almost always you can expect to pay higher premiums because of your health condition. Insurance companies charge more to cover the higher risk of the policy resulting in a claim.

But have you ever stopped to consider how the extra amount the insurance company wants you to pay compares with the rest of the market? If you did and you looked into this further you might be very surprised at what you might find.

Consider this example - Sarah and Sue are twin sisters aged 40, both non smokers and each requires £180,000 term life insurance over a 25 year term. The only difference between Sarah and Sue if that Sarah has no significant health conditions, whereas Sue has insulin controlled diabetes with average control.

Sarah is able to purchase the required cover from insurance company A at £15.34pm with insurance company B offering her the same cover at £15.73pm - or about 2.5% more than company A.

But for Sue its a different story. Due to her diabetes Company A's premium increases to £28.08pm. But company B now want a whopping £48.81pm!  - which is now over 73% more than company A, or an extra £6,200 over the whole term of the policy.

So why does the differential go from 2.5% to 73%?

The answer lies in the different underwriting decision that that the company A and company B make after looking at the medical information. Not all companies make the same premium pricing decisions. In fact each UK insurance company generally has well over a dozen different premium ratings bands from which to choose when deciding which one to put you into and the key thing is that they dont all choose the same banding!

The moral of the story is that if you have a significant health condition shopping around is even more important than normal and could save you a small fortune. Even if you have alreay purchased cover in recent year after being diagnosed with your condition it is worth doing some research to see if you can save yourself some money.

Finally if you find thought of doing the necessary daunting (which it certainly can be) why not get a specialist broker to have a look for you.

www.moneysworth.co.uk offer a no fee life insurance shopping service for people with health conditions. Its simple to use and Moneysworth do the research for you. You can also call with your enquiry on 0845 430 5200.

Diabetes and Life Cover in the UK - why delaying could end up costing you dearly

Whether you have diabetes or whether you are concerned about the possibility of being diagnosed with diabetes in the future you should take a minute to review your life cover. If you need more than its probably a good idea to act sooner rather than later.

Here's why.

Currently Diabetic? - Once you have started your life cover, the terms (including the premium amounts) are generally guaranteed for the rest of the policy providing that continue to pay your premiums, irrespective of future changes in your health. Delaying taking out cover will generally end up costing you more money when you take out cover at a later date because you will be older. It may also cost you more because of the progress of your diabetes, especially if you develop more complications such as retinopathy, neuropathy or kidney issues. So again arranging your cover now protects you from the effects that future changes are likely to have if you delay. Worse still some future health developments could mean that it becomes impossible to be able to obtain life insurance. One highly relevant example of this would be the future development of any heart issues which is a significant additional risk factor for diabetics. Unfortunately no mainstream insurance companies will offer life cover to any diabetic, type 1 or type 2, who also then goes on to develop a condition such as angina or who has a heart attack. However the life insurance policy terms for those diabetics who arranged their life cover before they developed any heart conditions are still guaranteed, which also means that if death accours as a result of a heart attack you are still covered.

Not Currently Diabetic But Worried About Being Diagnosed With Diabetes In The Future?
You would also be well advised to review your life cover now rather than later. Now you may still be able to obatin life cover at lower premium rates and in the absence of any significant existing health factors there is a good chance that you may be able to so at 'normal' premium rates, which are the cheapest premium rates. Again if you take out the cover now these premium rates are generally guaranateed. If you delay sorting out your cover until you are diagnosed with diabetes, expect to pay higher premiums and in some cases much higher premium rates. Also if you delay until you are diagnosed you should expect to experience difficulty in being able to arrange some other valuable benefits, for example critical illness cover. This could mean for example if the purpose of the life insurance is pay off a mortgage that the option to include insurance to pay off the mortgage if you have a heart attack is simply no longer available to you even though the risk of it happening has increased.

Business Owners - A Key Catastrophe To Avoid

A few years ago a bad thing happened.

We received a telephone call from a potential new client asking to cancel our appointment with him and his business partner because his business partner had died suddenly the day before. The purpose of the meeting had been to arrange some life cover for each of the two business partners so that if either of them died the other would be provided with enough money to buy out the other's shares in the business.

However shocking the sudden loss of a close friend and business partner was, the troubles didn't end there.

The family of the dead partner had never had any involvement in the day to day running of the business but of course they had depended upon the business for their income. What were they going to do now?

The two business owners had been skilled professional engineers and been responsible between them for most of the business reveue. With only one fee earner remaining the business faced significantly lower revenue meaning that the business could not continue to fund at the same level both sets of income - something would have to give.

How did this story end?

The remaining shareholder who was in his late 50's and had been hoping to retire in a few years was forced to remortgage his own home to provide the capital necessary to buy out his ex business partner's shares - putting up his own home as security was the only way he could raise the necessary required funds. Big change for him then and for his own family.

Here's a thought - what if I said this man was lucky! How could that be? Surely he was unlucky?

Well obviously he was unlucky because he hadn't put a robust disaster recovery plan into place in time and it ended up personally costing a him a fortune in added debt, delaying his retirement by years and putting himself, his family and his home at risk. The cost of the insurance premiums necessary to prevent this personal calamity would have been a fraction of what he ended up having to pay.

And the lucky bit? Well this all happened a few years ago at a time when he was able to raise sufficient extra equity from his property to finance the share purchase.

It could have been much worse - it could have happened now.

Because as we all know - right now persuading banks to lend money is a completely different proposition compared to a few years ago and likely to be even more difficult when the bank learns that the business has just lost a key person who was a responsible for a earning a significant proportion of business revenue. Put bluntly for a great many business owners the answer right now is going to be no.

And then what? A forced sale to a third party perhaps?

If you a have any concerns about protecting your business and your assets why not contact us at Moneysworth 0845 430 5200. We can help you take back control and make a plan to insure against the huge costs and risks of this future potential catastrophe for your own business.