options are available to you for life
insurance if you have health issues or
participate in hazardous
sports/activities. If you have
difficulties qualifying based on health,
there is a secondary market of high risk
insurance plans that might be a back-up
option. Let's take a look at how
First, how do we know if the standard term
life plans are probably not an option?
The answer is health class. Take a
look at our
term life health class page and list
of requirements. If you find your
health status or history does not fall
within at least the "Standard" health
class for one or more criteria, then the
standard plans may pose a problem.
Feel free to run your status by us.
Take advantage of our experience and
professional term life
what are high risk insurance
policies? The are essentially
simplified issue plans that offer a
limited benefit with other restrictions.
They tend to be whole life in design.
The whole life design makes sense with
such a risky proposition to the
insurance carriers for the same reason
we generally don't recommend it for
standard issue policies. Whole
life policies are front loaded much like
a mortgage is to a bank with an
increased premium going to the carrier.
The insurance company can quickly
collect enough with investment on the
premium to offset the increased
likelihood of having to pay out a claim.
This is usually not a good value when
compared to term life insurance as we
discuss in our
term versus whole life
article but we may not have any choice
if health dictates a high risk
What are some elements unique to high
risk insurance plans. Aside from
the whole life nature mentioned above,
there are other constraints.
First, the premium will be higher.
That's both a a function of higher risk
and the whole life design. The
lower amount of coverage offered should
offset this partially. In general,
most high risk policies function
similarly to Final Expense life
insurance plans in that they are not
large amounts relative to standard term
life which can quickly approach $500K
for a fairly low amount. There can
be constraints on how quickly the
benefit can be triggered i.e. not during
the first year of the purchase.
The application and enrollment process
is usually easier and may even preclude
the need for a
For some people, high risk insurance
coverage may be the only option and for
this reason, it has a place in the
market as a back-up option. Please
email us if you think this is most
likely your available option and we'll
provide a quote for you. We know
the carriers and their particular
underwriting kinks so we may be able to
address your needs and health status
with a standard plan. If not, we
can investigate if a high risk policy is
the only option to look at.