Does My Medical Condition Affect My Life Insurance Rate

Life insurance is a contract between you and the insurer. In exchange for paying a stipulated premium, the insurance company agrees to pay a sum of money to you or your nominee, depending on the plan you buy. The goal is to provide a financial safety net for your family or loved ones so they won’t have to worry about paying bills, final expenses, or other financial responsibilities in your absence.

When you apply for life insurance, you go through a process called underwriting with the insurance company. An underwriter works on behalf of the life insurance company to review your application details, health information, and lifestyle to determine your premium. And, during the underwriting process, insurers usually ask you to undergo certain medical tests called pre-policy medical checks to evaluate your health declaration. The list of medical tests will be decided, based on your health declaration, age, and total sum assured.

So, what are the medical tests you need to undergo when buying life insurance? What role does it play in determining your life insurance rate?

All of these questions and more will be discussed in this article.

Which Medical Tests Do You Need To Undergo While Buying Life Insurance?

Insurers generally follow a medical grid system, where each grid entails a list of diagnostic and radiological tests. According to your health declaration, your age, and the sum assured, you will be asked to undertake a grid.

Once your proposal has been submitted, the underwriter will conduct a telemedical round and assign you to a medical grid, which will require you to visit an authorised diagnostic centre at a scheduled time. Life insurance policies like term insurance usually cover the cost of the PPMC (pre-policy medical check-ups).

Some of the standard tests that you need to undergo include -
➔ A complete blood count to check glucose levels, cholesterol levels, etc.
➔ A urine test to check for any presence of tobacco, drug use, etc.
➔ Other tests such as liver function tests, kidney function tests, etc.

Medical Tests And Their Effect On Life Insurance Premiums

Medical tests help insurers to determine long-term risks. Through these tests, the insurer is able to get a larger picture of your overall health and your chances of developing diseases in the future.

➔ If your medical reports indicate you are healthy,
Insurers will approve your life insurance proposal at standard prices, without any changes to the terms and conditions of your life insurance policy.
➔If your medical tests show you are not so healthy,
You will likely be classified as a substandard risk and have to pay a higher premium. Additionally, they may add other restrictions to your policy or reject it altogether.

Factors Affecting The Premium

Besides your medical conditions, there are several aspects and factors that are taken into consideration by insurers while calculating the premium.

Some of them include -

1. Pre-Existing Medical Conditions
   Pre-existing diseases are medical conditions or diseases for which diagnosis or treatment was sought 48 months prior to the purchase of a life insurance policy. A life insurance policy will cost more if you have a pre-existing condition such as diabetes, cancer, high blood pressure, or heart disease. You need to note that insurers charge more for insuring individuals with pre-existing medical conditions. Keeping your pre-existing medical conditions a secret can lead to claim rejections.

2. Medical History Of The Family
   Besides your own medical history, insurers are also concerned about your family's medical history. Your family's medical history reveals the trend of genetic diseases running in your family, which can also affect you. Even if you are hale and hearty today, the prevalence of diseases in your family may increase your chances of becoming ill in the future. Hence, by conducting a thorough analysis, insurers can identify if you are genetically susceptible to critical illnesses such as diabetes, heart disease, etc. - which might increase your life insurance premiums.

3. Alcohol Consumption
   It is a well-known fact that excessive alcohol consumption can lead to chronic diseases and other serious health problems. So, heavy drinkers are likely to suffer serious liver and kidney diseases - thereby resulting in a higher premium.

4. Smoking Habits
   Smoking tobacco is extremely harmful to your health. Not only does it take a toll on your physical and mental health, but also negatively impacts your life insurance. Yes, it can significantly affect your premium. Smokers are considered high-risk individuals by insurers as there is a high likelihood of claims due to illnesses, disability, or premature death. This explains why smokers' premiums differ significantly from those of non-smokers. Whether you smoke occasionally or chain smoke, insurance companies consider you a smoker if you've smoked a tobacco product in the past 12 months. If you think you can hide this fact from the insurer, you are mistaken, since the insurer will find out when you file a claim.

Summing Up!

If the same premiums are charged for a healthy person and a person with existing health conditions for the same sum assured and policy tenure, won't that be unfair? This is why insurers determine your premium amount based on your current health status and risk profile. Above all, practice a healthy lifestyle, which will not only be beneficial for your physical and mental health but for your financial well-being as well.