Premium Decreases should be Provided Against Exclusions

Monday, March 15, 2010

It is both common and well-understood that life insurance companies seek information from applicants to their policies about pre-existing health conditions in addition to requesting data on age, lifestyle and habits. These are all used by the insurance provider to enable them to evaluate the insurance policy and then offer you a suitable premium. Life insurance suppliers also use this information to exclude certain conditions from your health insurance policy. It is these exclusions that are reasons behind the recent call to lower premiums.

It makes sense to argue that the consumer should not be paying out large premiums if their insurance policy does not cover them for the very illnesses that they are more prone to falling victim to.

There is, however, a light at the end of the tunnel. The industry has become a great deal more competitive and providers are vying with one another for your business. There are, as a result, many life insurance providers offering policies that are taking the disconnect between premiums and exclusions seriously and are offering reduced rates to reflect the exclusions.

It is also worth bearing in mind that if an exclusion is added to your policy, most insurers will treat their customers in the right way and work with the client to find the most applicable policy for the individual’s requirements. If in doubt, do ask for independent financial advice. The best advice, however, is to take out life insurance when you are in the peak of health and this will help protect you against exclusions.


Jenny Guy