Life Insurance and medical history query

san09

Hi all,

We're a couple in the process of purchasing our first home, and are searching for life insurance mainly to pay off the mortgage should one of us die (we have 2 little ones).

We're aware we should be informing the Insurance company of conditions we have/had, but what do you think of this?

3 years ago hubby was tested for possible angina symptoms (he has a family history of this). The test results came back as borderline angina, however he hasn't really had any symptoms of it since.

Would you think we would have to inform the Insurance company of this?

We really want to be honest as dont want to invalidate the policy by failure to provide information.

Would this happen if we didnt mention it and hubby was to die of something related to angina, even if he were not to have any actual symptoms now?

So much to think about and think I know what the answer is already, but just wanted to see what eveyone else thought. We've never had insurance before and are really lost and out of our depth with all this at the moment.

Thanks in advance for any information.

Sorry forgot to mention, there is a history of angina in hubby's family.

ACG

Yes you have to disclose it.

You will most likely also need to disclose the family history of Angina also.

OshayAway

As ACG says you will have to disclose both. How many family members with heart problems and what ages at diagnosis? The family history factor would likely put your husband in a higher risk catagory as typically cardio-vascular issues are hereditory.

I would expect any insurer to write to your hsbands GP and that will incude information about his family history anyway. So even if their ages meant it didnt need to be disclosed on application, it will come out from the GP report.

Having said that, insurers would certainly vary on how the perceived risk would translate into premium loading. If you were to enlist the help of a good broker, they woud be able to approach insurers before submitting an application, to ascertain which would likely offer best terms. In some (albeit rare) cases, an exclusion can be requested in lieu of a loading.

san09

Thanks for the replies.

Do you think that's what we're best doing?
Would we just approach a local broker and request he apply on our behalf, and then he'd advise us of the companies willing to cover us and the premiums charged?
How do brokers charge for this service?

ACG

You would probably be best going with a broker. They will make the whole process quicker and easier for you.

Have a look on google or try unbiased.co.uk to find a local advisor - both mortgage and financial advisors can help you with this query.

Brokers get paid commission by the Insurance company. So you dont have to pay anything to the broker.

san09

Thanks ACG.

Would that mean the broker is affiliated to certain Insurance companies?
Would we truly be getting unbiased advice?

ACG

There are 3 types of advisor:
Tied
Multi-tied
Whole of Market

Tied - would usually be a bank, they have access to 1 insurance company only.
Multi-tied - they have access to a number of insurance companies. But not every company.
Whole of Market - they have access to every company on the market.

Each has its own pros and cons.

They all have to act on YOUR behalf. All life offices pay commission so it doesnt matter who they submit the business to - the advisor will still be getting paid.

In your very first meeting your advisor wll give you a sheet of paper which will tell you which of the above they are.

OshayAway

Whoever you chose, make sure they are prepared to reseach all the providers they have access to. Because some insurers will treat your case more favourably than others, it's important to do pre-application underwriting research. Unfortunately, finding one to do this is easier said than done as done correctly, is very time consuming. The more insurers they use, the better chance of getting a better outcome but the more time this takes. Ringing several insurer's underwriting departments can easily take a coule of hours. To be sure that the reseach is comprehensive, ask for a copy of the results.

As a result of this though, if it looks like you would have difficulty getting cover or a very high loading based on the perceived risk, a broker may be reluctant to spend alot of time on it.

ACG

OshayAway wrote: »

Whoever you chose, make sure they are prepared to reseach all the providers they have access to. Because some insurers will treat your case more favourably than others, it's important to do pre-application underwriting research. Unfortunately, finding one to do this is easier said than done as done correctly, is very time consuming. The more insurers they use, the better chance of getting a better outcome but the more time this takes. Ringing several insurer's underwriting departments can easily take a coule of hours. To be sure that the reseach is comprehensive, ask for a copy of the results.

Its not that difficult. 1 email to your account managers or underwriters where you have no account manager.

Admittedly some are lazy and will just submit it with one life office if it declines they wont bother elsewhere but in the current climate i would imagine people are more prepared to fight to get business on the books.

OshayAway

I wish none were lazy! Being aware of what pre-application research can be done and seeing the research is a good way to be sure all bases are covered.

Many times I've arranged cover for individuals who have already applied via a different broker / adviser who has clearly not done any underwriting research.

ACG

Lazy advisors help to make the good ones look better - put a positive spin on it :-)