What happens if I’m denied life insurance?

If you’re denied life insurance, take comfort in the fact that you’re not alone—and that there are options.

People are typically denied life insurance because they fall into a high-risk category. This is often due to health challenges like diabetes, obesity or a previous diagnosis of serious disease.

There are also nonhealth reasons for being denied 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.

No matter what the reason, here are some steps to take if you’re denied life insurance.  

  • Contact your agent and/or the insurer. They can make sure a mistake wasn’t made on your application. They can also give you insight into why you were denied life insurance.
  • Confirm the results. If poor health is cited as the reason for the denial, check in with your physician to make sure there really is a cause for concern. If the reason for denial isn’t health related, double check to make sure the reason they cite is valid.
  • Consider appealing the decision. If you’re denied life insurance on the basis of incorrect or insufficient information, you have the right to appeal the decision. You’ll have the best chance of winning your appeal by submitting timely and complete information. This means having your doctor include as much up-to-date information in your medical file as possible and submitting the most recent and credible information about your personal history. This can include anything from your credit report to your driving record to updated information about your occupation.

Getting Coverage After Being Denied Life Insurance

If you’ve been denied coverage before and would still like to get life insurance, here’s what you can do.

  • Work with a licensed insurance agent. Many people are denied life insurance after trying to go it alone when seeking life insurance coverage. A licensed insurance agent who works with many insurers can help you apply to the ones that offer the best chances of approval. An agent can also help you with the application and the appeal process if you’re denied life insurance. What’s more, some agents even specialize in helping higher risk individuals get life insurance. Check out our agent locator to start the process today.
  • Apply with a different insurer. Every insurer has different criteria for life insurance approvals. Try applying for life insurance with a different insurer (or insurers) before giving up hope.
  • Look into a workplace life insurance plan. You might have luck gaining coverage through your employer’s group life insurance plan. It may not give you the coverage limit you want, but with life insurance, something is always better than nothing. Most group life insurance plans typically don’t require you to undergo a medical exam.
  • Try again later. Use a waiting period to get any health conditions under control, quit smoking, clean up your driving record and improve your finances. An insurer that sees progress in these areas is often more likely to offer you life insurance.
  • Consider a different life insurance policy. It bears repeating that even a small amount of life insurance is better than none at all. Here are some policies to consider if you’ve exhausted your options:
    • Simplified issue life insurance: With this option, you typically fill out a quick online life insurance application. A medical exam is not required, but you may be asked questions about your health. There’s typically a high approval rate, and you can often get instantaneous coverage. The downsides are that the coverage limit is often low and it often costs more, on a dollar-for-dollar basis, than traditional life insurance coverage.
    • Guaranteed issue life insurance: You can skip both the medical exam and the medical questionnaire with guaranteed life insurance. As its name implies, coverage is guaranteed for anyone who applies. However, there’s often a waiting period before a full payout would be made to your beneficiaries if you were to pass away. That waiting period can stretch as long as several years. You also won’t be able to access higher coverage limits and the coverage costs more, on a dollar-for-dollar basis, than traditional life insurance.

No matter where you are in the life insurance process, it’s always a good idea to get in touch with a licensed insurance agent. He or she can walk you through the entire process and help you pinpoint options if you’re denied life insurance. If you don’t have an agent or advisor to work with, check out our agent locator. You can also work directly with an insurance company. Here are company partners that support our non-profit mission and can assist you in getting coverage directly or through one of their agents or advisors. The key is to start today.

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