Case Studies

What happens when health information that is necessary for determining an underwriting decision for a life insurance policy is not disclosed to the insurance company during the health evaluation process?

Establishing whether or not the information was deliberately withheld on the application and or from the paramedical examiner would be a good first step. The second thing is to figure out whether the prospective client was aware of the “new” information that was revealed during the process.

In either event, the outcome would still be in favor of the life insurance applicant as the new information would merely change the person’s category of insurance and premiums. Undisclosed medical information is not necessarily a deal breaker when it comes to applying for life insurance when you are working with Life Insurance 2.0.

Consider the following real life case study:

As you can see Life Insurance 2.0 is asking for the insurance company to make an offer based on the information submitted upon application and what was received in the field.

“If you could take a look at this case please; it’s a competitive situation. All underwriter requirements have been met and delivered; are you able to make an offer today?? It would be greatly appreciated.”

The insurance company replied via email indicating there was medical information that had not been disclosed.

“At present, I am trying to locate the lab results for this case file, as these results are not attached to our imaging data base. I will follow up with the case manager to see if we have made any progress.

In the meantime, I can tell you that we are tentatively tracking a Table 3 rating due to undisclosed medical information. The insured did disclose having a spot on her liver. The attending physician’s letter attests that this spot is a hemangioma. Therefore, this condition is considered standard.

The medical condition prompting the Table 3 rating was not included in the paramedical interview and is thus considered undisclosed information. I cannot relay the specifics of this condition due to confidentiality restrictions, but I can tell you that the information was obtained from the Clinic.

I will provide you with additional updates as I receive them. Please let me know if you have any questions. Thank you.”

Life Insurance 2.0, being on top of every life insurance application for their clients, fires back some interesting questions for the life insurance underwriter who is assigned to this case.

“Regarding the “undisclosed” information – is it the fact that it was undisclosed that determines the rating or just the underlying condition itself? Is it a combination of the two? If it is something private in nature or something the applicant doesn’t realize is pertinent to the health evaluation or the doctor told them “It’s nothing to worry about,” most people don’t mention these issues.

Is the fact that an applicant inadvertently omits (undisclosed) information counted against them during the underwriting evaluation?

Intrigued by the questions Life Insurance 2.0 has asked, the life insurance underwriter responds with the following email. You will notice the important information that if a person “inadvertently fails to disclose information” it is NOT counted against them.

“Very good questions. The fact that a person might inadvertently fail to disclose information is not counted against them.

An underwriter will only make rating decisions on medical information provided in interviews and medical records. A condition itself is not private in the sense that it is life threatening. The only reason that I cannot relay the specific details is the information cannot be found on the paramedical interview. The paramedical interview acts as a general information source.

By completing the interview, the insured is consenting to disclosing medical information to members of underwriting and persons involved directly with a life insurance application. This means that a broker would have access and can preview the information contained on the paramedical interview.

If there is information missing from the interview, underwriting does not have the insured’s consent to release those medical details. That is the situation that I am encountering here. The insured did relay that there was a spot on the liver, prompting underwriting to order medical records. When reviewing the records from the Clinic, another medical condition was discovered.

It was this previously unknown medical condition that warranted underwriting debits. I am not sure if the insured is aware of this condition. I would presume that the insured knows, as a series of tests were performed.

The moral of this real life case study is if you forget to tell the life insurance company about a medical condition or aren’t aware of it or were told not to worry about it and therefore did not mention it, it will NOT count against you when making an application for life insurance.

If you have Life Insurance 2.0 on your team, you will get what you need with the minimum of fuss and the maximum in service from expert agents with years of experience to back them up. Call us or email us today and let us know how we may assist you.