Health & Life Insurance Information
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Health Coverage
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Each insurance provider has a set of qualification standards that determine who they will insure and how much they will charge. These standards are called underwriting guidelines. Applicants unable to meet certain guidelines are either denied coverage or required to pay higher insurance premiums.
Health insurance is designed to pay benefits for medical costs such as doctor's visits, prescription drugs and surgeries. In exchange for a monthly premium paid to the insurance provider, policyholders receive medical service for a small out-of-pocket cost.
Health insurance underwriting guidelines focus on the overall health of the applicant. Insurance providers determine which health conditions will automatically deny an application as well as conditions that may not be approved for coverage. Chronic illnesses that require ongoing treatment are typically cause for a health insurance denial. Providers also consider the height and weight of the applicant to determine if he is obese or at risk for weight-related health problems. Family history, as well as previous history of illness, injuries or surgery may also be disqualifying factors.
Life Coverage
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Life insurance pays monetary benefits to a policyholder's beneficiaries upon their death. To qualify for coverage, life insurance providers consider the applicant's health as well as age, family history and lifestyle. The younger and healthier the applicant, the more coverage she may receive for the least amount of monthly premium.
Applicants above a certain age may be eligible for limited benefits. For example, guaranteed acceptance coverage through New York Life Insurance provides life coverage for applicants between 50 and 80 years of age. However, the coverage only provides a maximum death benefit of $15,000 to the policyholder's beneficiaries. In many cases, $15,000 is not enough to pay for a policyholder's final expenses. Many life insurance companies do not provide coverage for applicants beyond a certain age because they are more likely to pass away within the policy period.
Exclusions
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Health and life insurance policies have a variety of policy exclusions. An exclusion eliminates certain health conditions or people from an insurance policy. Health and life insurance policies set limitations on coverage for individuals with certain conditions or ailments. For example, a life insurance provider may refuse to pay death benefits for a policyholder who dies because of cancer or heart disease. Similarly, a health insurance provider may refuse to pay medical claims for such conditions. Life insurance providers also exclude death by suicide for a specified time during the policy period.
Chronic health conditions that have been diagnosed or treated prior to receiving insurance coverage are considered pre-existing and are typically excluded from coverage. It is necessary to review your life and health insurance policy carefully to fully understand the types of conditions covered by the policy and those that are not.
Insurance Providers
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Insurance is a highly regulated industry. Insurance providers must meet federal and state regulations to offer health and life insurance to consumers. Insurance agents are required to maintain state-issued insurance licenses as well as periodically attend continuing education to stay abreast of changes in the industry.
Individuals unable to obtain insurance through traditional means have the option to seek coverage through state insurance pools or federally issued insurance plans. To help individuals obtain health insurance, for example, the federal government has enacted the Pre-existing Condition Insurance Plan (PCIP) to provide affordable coverage for individuals who would not qualify through traditional insurance providers.
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