Life Insurance Requirement – How Does Life Insurance Work – Life Insurance Guide

Life Insurance Requirement – Before venturing into any heavy financial venture or commitment, there are laid down rules to follow, and life insurance requirement is no exception.

You must take out time, to educate yourself on the life insurance options, requirements, the type of coverage, etc., before you commit your resources to it.

Thus said, let’s know what life insurance is all about before we delve into the requirements needed.

Life Insurance Requirement  - How Does Life Insurance Work

What is Life Insurance?

Life insurance policy is a process where an insurance company offers a coverage, to a client, which the client pays for, in order to provide the resources the dependents need in the event where the insured is no more.

Choosing a Life Insurance Policy

Life insurance is divided into two main groups: Permanent life insurance, which offers coverage for your entire life, and Term life insurance, which on the other hand,  offers coverage for a set period of time.

Once you’ve made up your mind on purchasing life insurance, you will have to decide on the coverage you want, considering the amount involved and how much resources your dependents will need to sail through. The amount of this coverage, will be depend on several factors, like age of your beneficiaries, your spouse’s financial ability as well as your combined financial resources.

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Life Insurance Requirement

When applying for life insurance, you will be asked to supply some basic information like your name, address and employer. You will also be asked the following questions: Height, weight, date of birth, lifestyle (i.e., smoking, drinking, exercise) and financial information, including your annual income as well as net worth.

Life Insurance Medical Requirement

After the first step, some companies still go further to ask for an in-person medical exam. The company’s agent arranges for a licensed healthcare professional contracted by the insurance company (paramedical), to schedule an appointment with you in your home, office, or a clinic chosen by the insurance company.

During the exams, the following will likely be carried out;

  • Your medical history (including medical conditions, surgeries as well as any prescription medications) will be carried out.
  • You will be quizzed about your immediate family’s medical history.
  • Take your blood pressure
  • Your heartbeat will be listened to.
  • Height and weight checked.
  • A blood sample will be drawn.
  • A urine sample will be taken
  • Questions will be asked about your lifestyle habits that could affect your health (e.g., exercise, smoking, drinking, recreational drug use, frequent travel, high-risk hobbies)
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After you have completed the first phase of the medical test, there may be additional tests you need to undergo depending on your age, the type of policy you require as well as the amount of coverage you are applying for. These additional tests could include an EKG, a chest X-ray, and/or a treadmill test.

Thereafter, an underwriter at the insurance company will have your application and medical exam results reviewed. The information obtained will help the company determine what risk you represent to the company financially as well as the charge for coverage.

After your application and medical exam have undergone review, the company will decide either to grant or deny your request to purchase coverage. The process may take days or weeks,it all depends on if you’ve submitted a complete application, as well as how long it takes to receive lab results, in the event where the company asks from your physician.

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On a final note, we advised that you try as much as you can to be transparent about your weight or other health-related issues. If you lie about your health information and the company gets to find out, your premium might be increased, your policy canceled, and /or deny your beneficiaries claim to the death benefit.

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