I am very ashamed to admit it, but I only got life insurance late in life. It’s why I write about it whenever I can. When we are young, we are convinced that we will live forever. Youth is wasted on the young, as the saying goes. I am not going on an anti-youth screed, just emphasizing that we usually find enlightenment and wisdom later on in life. Sometimes, when its much too late to do much good.
Take life insurance. When I was in my 20s and 30s, the idea of enrolling for life insurance was uncool, boring, and something that only old people worried about. I really miss being that young and naive. Although, I wish I could teleport my current intelligence back into my young body. I learned too late in life that life insurance is cheapest for the young and healthy.
Apply As Young As Possible
When you apply for life insurance coverage, actuaries and underwriters break your application down into basic data points. Like how healthy you are, your occupation, and how long you might live. Those who are usually approved for life insurance, relatively easier than others, are young people. Young people are healthier and less likely to encounter the diseases and illnesses that befall older people.
Consider that the average annual cost for a 25-year old who smokes to get life insurance is about $830 a year. Or, about $270 for a non-smoker. Meanwhile, a 45-year old life insurance applicant who smokes is liable to pay $2,600 a year. Or, about $700 a year for a non-smoker. Keep in mind that these are just estimates. Application standards varies case by case. Especially if you are sick or deathly ill.
Apply When You’re Healthy
Applying for life insurance coverage becomes complicated if you’re ill. It isn’t necessarily that you won’t be approved. People with high blood pressure, cancer, MS, diabetes, and various other diseases can be approved as so-called pool applicants. Some life insurance policies are marketed to old and sick people because it is difficult for them to be approved elsewhere. The issue is that the application process becomes more exhaustive and premiums more expensive.
An insurance company will want to know the severity of your condition and how long you have had it. Or, if it is a chronic condition. They will request that you undergo medical exams and present medical and prescription histories. Your chances for approval increase appreciably if your medical problems are controlled. Or, your approval may hinge on a full diagnosis of a suspected medical problem. You may also want to consult people like Worcester medical malpractice lawyers for more information.
Many people with medical problems are approved for life insurance through the, “graded benefit,” system. This could mean several things. For instance, a life insurance company could make you wait 2 or years before instituting benefits. You may not be able to access your coverage during this period. Or, if you died during these so-called, “waiting periods,” your beneficiaries would zero death benefits. Or, they would receive a significantly smaller percentage of death benefits.
You Have Options
Unless you have AIDS or HIV, there are numerous life insurance companies who approve applicants with serious medical conditions. Even then, you should expect to pay hundreds of dollars a month in premium. Consult a life insurance broker or agent who can help you to find exacting coverage according to your medical needs.
If you are under 45, apply for some basic coverage as soon as possible. Life insurance coverage becomes more expensive the older you become, healthy or not. Don’t learn to appreciate it once it becomes ever-more cost-prohibitive.
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Allen Francis was an academic advisor, librarian, and college adjunct for many years with no money, no financial literacy, and no responsibility when he had money. To him, the phrase “personal finance,” contains the power that anyone has to grow their own wealth. Allen is an advocate of best personal financial practices including focusing on your needs instead of your wants, asking for help when you need it, saving and investing in your own small business.