Why Has My Life Insurance Premium Increased After Medical Underwriting?

When you apply for life insurance, you will usually be given an estimated premium based on the information you provide. It isn’t always obvious that this is just an indication of what the cover may cost. If the insurer asks medical questions about you or your family, your travel, work and hobbies, the final premium can sometimes be higher than the original quote. Most insurers will ask you about these things if you are applying for a typical life insurance policy in the UK. This can sometimes make people feel worried, or potentially even angry at the insurers, particularly if you were expecting the cover to be available at the price you were originally shown. Let’s go through why life insurance prices can change.

What is medical underwriting?

Medical underwriting is the process an insurer uses to assess your current health and medical history when you apply for life insurance. You may be asked questions about your health now, in the recent years and over any time period. As an example, in the UK you are likely to be asked if you have ever had cancer. Depending on your answers, the insurer may also request further information from you, your GP or another medical professional. The insurer uses this information to understand your health and assess the likelihood of a claim being made during the policy.

Why has my life insurance premium increased?

There are several reasons why an insurer may increase your premium after medical underwriting. One of the most common reasons is that the insurer has identified a health condition or medical history that was not fully reflected in the original quote. This could include conditions such as:

• Diabetes
• Heart conditions
• Some mental health conditions
• Previous cancer
• Strokes

The insurer may also consider factors such as your current treatment, medication, how well a condition is controlled and whether there have been any recent complications. It is important to remember that having a medical condition does not automatically mean you will be declined for life insurance. Instead, the insurer may decide that a higher premium is appropriate to reflect the additional risk. They also might not increase the premiums and give you the life insurance at what is known as standard terms.

What is a medical loading?

If an insurer believes that your health increases the risk of a claim, they may apply what is commonly referred to as a medical loading.

This means that the premium is increased to reflect the additional risk identified during medical underwriting.

For example, you may initially receive a quote of £30 per month. After reviewing your medical history, the insurer may decide that the risk is higher than originally expected and increase the premium to £40 per month.

The exact amount of any increase will depend on the insurer and your individual circumstances.

Can the insurer change the terms of my life insurance?

Depending on your circumstances, an insurer may:

• Increase the premium
• Add an exclusion to the policy (this is not usually done)
• Offer a lower amount of cover
• Offer a shorter amount of time for the cover being active
• Decline the application

The decision will depend on the type of life insurance you are applying for and the information provided during the underwriting process. Most of the time with life insurance the options are normal terms, an increased premium, or a postponement or decline of the application.

Does every insurer assess health in the same way?

No. Different insurers have different approaches to medical underwriting. They may also have different views on particular health conditions. This means that one insurer may offer cover at standard rates, while another insurer may apply a premium increase. This is one reason why it can be useful to speak to a life insurance specialist like us, rather than simply accepting the first offer you receive. An experienced adviser can help you understand why a premium has increased and whether another insurer may be able to offer more favourable terms.

Can I challenge an increased life insurance premium?

If your premium has increased following medical underwriting, it is worth asking why the decision has been made. Your adviser should be able to explain the insurer’s decision and check whether the information they have used is accurate. This can be tricky due to data protection and what the insurers will discuss with advisers, but here at Cura we have built a strong relationship with insurers in the UK and abroad, so that we can discuss things openly with you and the insurers. If the medical information supplied by your GP or another medical professional is incorrect or out of date, it may be possible to ask for this to be reviewed. It may also be possible to approach another insurer, although you should always provide accurate information about your health and previous applications.

What should I do if my life insurance premium increases?

Don’t automatically assume that the increased premium is your only option. The most important thing is to understand why the insurer has changed the terms and whether there are any alternatives available. At Cura, we can help you understand how your health and medical history may affect your life insurance and look at the options available from different insurers. If your life insurance premium has increased after medical underwriting, or you have been offered cover that doesn’t feel quite right, ask us to review the decision with you. If you want more information about life insurance and medical underwriting – ask us. Our award winning advisers arrange life insurance, critical illness cover and income protection insurance every day and know the best ways to protect you. Get in touch with us for a no obligation quotation today.