What to Do When You Don’t Qualify for Life Insurance (2024)

FAQs

What to do if you don't qualify for life insurance? ›

They can include engaging in risky hobbies and behaviors like skydiving; having a history of DUIs or speeding tickets; having a dangerous job like roofing; having a criminal record or a less than ideal financial history; being a smoker; and failing a drug test.

Talk to Your Agent or Broker

As the applicant, you can request information regarding the denial. It could be due to your medical history, driving record, or life insurance medical exam results. Talk with your broker or agent to figure out what options you have.

LYING ABOUT DRUG USE OR TOBACCO & ALCOHOL USE

An applicant for life insurance must disclose lifestyle habits, good and bad, including use of alcohol or use of tobacco.

Even if you've been refused life insurance due to any of the reasons above, it's still possible to secure affordable cover elsewhere. This is because each insurer has a different way of assessing risk, and some may accept your application where others won't.

Annuities. These function like savings accounts that pay income to you during your life and into retirement. Pros: Annuities provide retirement income that can be used for everything from rent to travel. They can be set up to pay your loved ones upon your death the same way life insurance would.

Due to the added risk health problems create for insurers, some pre-existing conditions can raise your premium or even disqualify you entirely from certain types of life insurance. A few common examples of pre-existing conditions include high blood pressure, diabetes, cancer, and asthma.

Policy will lapse.

You will most likely have to pass a physical examination for the reinstated policy and pay back the premiums you would have paid plus interest. Annual premiums for the reinstated policy may be lower than those for a new, comparable policy.

How to get approved for life insurance? ›

The underwriter will carefully review your life insurance application and medical exam results. He or she will also consider several other factors like your driving record, hobbies, credit history and more. It usually takes at least a few weeks to find out if you're offered coverage.

Whether you're trying to choose the right life insurance policy or you're a beneficiary of an existing policy, it's valuable to know the average life insurance payout you might expect in the U.S. Here's what beneficiaries can expect on average: Average payout: $189,000. Time to payout: 30-60 days after filing.

Financial situation

The insurer may ask questions about your income, net worth and assets. This is to ensure you can afford to pay the premiums to maintain your life insurance, and that the amount of coverage you're applying for makes sense.

Many people use income as a way to determine how much life insurance they should buy. The goal is to make sure the policy provides a big enough payout for income replacement if loved ones can't depend on that salary anymore. A general rule of thumb is typically about seven to 10 times your income.

The key reasons life insurance may not pay out include if the policy has expired, lapsed due to unpaid premiums, the insured was untruthful on the application, the insured died from illegal activities, suicide, homicide, or during the waiting period.

If you want to buy life insurance, you need to apply and qualify first. Applying for life insurance typically involves filling out paperwork, taking a medical exam, and providing health histories for you and your immediate family.