Declined for Life Insurance…Now What?

After many grueling hours of researching life insurance companies and comparing quotes, you submit your application only to be told that you are not eligible for coverage. While you probably have an opinion about whether or not this decision was fair, the best thing you can do is to get a second quote. No two insurance companies follow the same underwriting policies and their guidelines are never truly set in stone. Learn from the decision and find another company and agent who are willing to offer you decent coverage at a reasonable price.

Reasons for Denial

Typically, while an insurance company may reject your application based on their underwriting guidelines, the reason for denial is most likely due to a health condition. Some companies may feel that asthma is an acceptable circumstance an individual must live with and it poses no threat to the company, while others may feel that asthma may mean a higher premium for the applicant.


Almost all insurance companies will require you to undergo a physical and medical evaluation at no cost to you from a qualified physician, typically chosen by the insurance company. They will need to see copies of medical histories for you and your family, any preexisting health conditions or current diseases. Some diseases that may result in your application being rejected include HIV/AIDS, cancer, smoking, asthma, obesity and certain congenital heart conditions, heart problems or cardiovascular disease.

If the insurance company finds you uninsurable, a note is made with the Medical Information Bureau so that other insurance companies can see your records. The purpose of the MIB is to reduce and even eliminate the chance that somebody will commit insurance fraud by trying to hide information about previous denials or rejections. For instance, if you lie about certain health conditions or the fact that you were previously rejected from an insurance company and a different insurer finds out at a later time, you could be represented as someone who “intended to deceive or misrepresent” the circumstances. In fact, if the insurance company finds out that you were not completely truthful and you pass away while you are covered under a particular policy, your beneficiary may not receive the benefits that you had been paying for.


Some insurance companies believe that the older you are, the harder it is to receive life insurance. Depending on your age and the type of policy, you may find that obtaining life insurance can be difficult, if not impossible. Most life insurance companies do not offer term life policies after you reach age 70.


If you work or are involved in dangerous or hazardous occupations or circumstances, the life insurance company may feel that you pose an increased risk and will either charge you a higher premium or deny your application completely. For example, individuals who work in industries including construction, restoration around asbestos-filled homes, coal mining and nuclear power may find it difficult to obtain insurance.

Bad Habits

Carelessness toward your overall health can result in the rejection of term life insurance. If you are otherwise in perfect health and you smoke, frequently use drugs, have numerous speeding tickets or have been arrested for driving while intoxicated, the insurance company may feel that you are irresponsible and cannot look after yourself.


Even if you take good care of your health and have a relatively safe job, depending on your recreational activities, the insurance company may or may not agree to insure you. For example, skiing, surfing, skydiving, scuba diving, base-jumping, snowboarding and rock climbing are just a handful of the activities that an insurance company may frown upon.

What Comes Next?

·         If you have been denied insurance due to health reasons, you can seek out an impaired risk specialist who has experience in obtaining coverage for individuals who pose an increased risk. These advocates are generally free of charge since they receive a commission from the insurance company with whom they pair you.

·         If you were diagnosed with a particular health condition as a child, try reapplying again for insurance because as you age, the effects of your condition should become more apparent. Make sure you have complete copies of your medical records and ask your doctor if he can provide any positive information pertaining to your condition.

·         If you fall within a particular age range for your policy, you absolutely cannot be denied coverage based on your age alone. Just be completely honest about your age to avoid creating complications for yourself in the future.

·         If your job or your lifestyle poses an increased risk to health insurance companies, think of ways to alleviate the risk. Prove to the underwriter that you have taken safety courses or obtained licenses as evidence of your commitment to safety.

·         If you had used drugs or been convicted of driving under the influence in the past, point out that you have been clean for however many years to prove you are recovering. Provide evidence that you have taken the necessary steps to eliminate any and all bad habits from your life, as well as why and how you plan to maintain your healthy lifestyle.

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