The Surviving Spouse’s To-Do List, Part 3: The Estate

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Over the last few weeks, we’ve detailed the initial steps a widow(er) should take after the loss of their spouse. Part One tackled the paperwork that must be gathered, while Part Two offered advice regarding collecting survivor benefits. This week, we will address the steps regarding handling the will and preparing the estate.

Again, we encourage you to partner with a friend, family member, or trusted professional to assist you in making any necessary decisions during this difficult time. Anything that can wait – leave it until your emotions aren’t quite as high. Allow yourself the time the mourn. There are few things that can’t wait.

Estate Preparation

The first thing you will need to do is contact key people regarding the estate. Hopefully, you and your spouse worked together during the will preparation, so you are familiar with the attorney that drafted the will, as well as the contents of it. Contact the executor of the estate as well as the lawyer. If you are the executor, enlist the help of your estate attorney throughout the estate-settlement process.

Until you’ve had a chance to meet with your estate lawyer, experienced attorneys recommend that you not transfer any of your spouse’s assets into your name. Once you’ve done so, you lose the right to “disclaim” the property. When you “disclaim” property, those assets are transferred directly to your living heirs, protecting those assets from your federal and/or state-tax exemption when you pass away.

Pro tip: Before you agree to work with an attorney, inquire about their fees. Many will agree to a flat fee of a few thousand dollars. There are, however, many that charge based on a percentage of the assets in probate. Depending upon the contents of the estate, this could turn out to be a very large bill.

Probate

The term “probate” refers to the process of distributing the contents of the estate to its named heirs and paying any outstanding debts the deceased had at the time of their death. It generally entails the following:

  • Appointment of an executor of the estate. If a will was never drafted, the court will appoint a personal representative, generally the spouse.
  • Proving the validity of the will.
  • Notification of probate to all heirs, beneficiaries, and creditors.
  • Disposal of the estate, according to the contents of the will or state law.

Any assets that are jointly owned by the deceased and another party are excluded from the probate proceedings. Proceeds from an IRA and life insurance policy are also excluded when distributed directly to the beneficiary.

State and Federal Taxes

You are required to file a federal estate-tax return within nine months of your spouse’s death. State estate taxes and inheritance taxes could have an earlier deadline, so be sure to check the laws on a local level.

Summary of taxes that should be addressed and paid:

Federal Estate Tax: Estate taxes are typically only due on estates in excess of the unified credit exemption. The exemption amount changes each year, so check with your estate attorney for the most up-to-date information.

State Death Taxes: While the laws on this vary from state to state, beneficiaries are typically required to file a state death tax form or state estate and pay state death taxes. Taxes due are paid to the state in which the deceased resided upon their death and are dispersed directly from the estate.

State Inheritance Taxes: While many states do not require an inheritance tax, it is required in some states. Again, speak with an attorney or trusted tax representative regarding local law.

Federal and State Income Taxes: Taxes are due on the normal filing date of the following year. An extension can be requested if necessary.

Pro Tip: Save all receipts that are relevant to the estate, particularly if the estate’s value exceeds the estate-tax exemption. Funeral and post-funeral expenses are a legitimate write-off.

This is also a good time to revisit the subject of who will make financial and healthcare decisions on your behalf, should something happen to you. If your spouse was your representative, you will need to designate a new agent for your healthcare power of attorney, healthcare directive, and/or financial power of attorney.

Stay tuned for Part 4, where we address the next items on your to-do list. Don’t hesitate to contact us with any questions, at 1- 866-450-2424.

The Surviving Spouse’s To-Do List, Part 2: Collect Benefits

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Last week, we started our six-part series – The Surviving Spouse’s To-Do List, detailing the initial items a widow(er) should do after the loss of their spouse. While we encourage you to leave any big decisions for after you have had a moment to grieve, there are some things you will need to start doing in the months to follow.

Last week was about gathering paperwork. This week, it’s time to start thinking about what you need to do to collect survivor benefits. Let’s get started.

Enlist Help

Whether your spouse had a long battle with an illness or his/her death was unexpected, this is an incredibly difficult time in your life. To help you with the tasks and decisions that lie ahead, consider putting together a "financial support team." This could include a close family member or friend, a financial advisor, accountant, or attorney. Just make sure your team is comprised of individuals who understand and respect your views and can be trusted to help you make sound financial decisions.

Social Security

A widow(er) of full retirement age is entitled to 100% of their deceased spouse’s Social Security benefit. You can collect this survivor benefit before you reach retirement age, but you will only receive a percentage of the total benefit. If you were collecting spousal benefit prior to your spouse’s death, the survival benefit will take its place. Individuals who are younger than full retirement age will lose all the spousal benefit if they decide to wait until they are fully eligible. For more information or to view your (or your spouse’s) annual Social Security statement, log on to the Social Security website.

Life Insurance

If your spouse carried a life insurance policy, you will need to file a claim to receive the death benefit. You will need a copy of the death certificate to begin the process.

When filing the claim, you’ll be given some paperwork to review and sign. Read this document carefully, as you will need to make a decision regarding how you would like the funds dispersed. There are benefits and downsides to each option, so seek the advice of a financial advisor or attorney if you don’t fully understand your choices.

If you cannot find the paperwork for your spouse’s life insurance policy, go through your bank statements or check registers to see if any payments were made to an insurance carrier. It’s also a good idea to check with your spouse’s employer and any professional organizations they were a member of. If you are still unable to locate a policy, MIB Solutions' Policy Locator Service can often help find the information needed. Inquire about their fees before enlisting their help.

Employee Benefits

In addition to a life insurance policy, you may have other employee benefits due to you. This could include: unpaid salary, accrued sick leave and vacation, unpaid bonuses, stock, and/or funds from a medical flex spending account.

You will also want to check on pension benefits and your spouse’s 401(k). Notify the pension plan administrator of your spouse’s death as soon as possible. Some pensions reduce the pension’s payment amount once the primary has passed. If this is less than what you are currently receiving, you could be expected to send back any overpayment.

Health insurance is another item to consider. If you were covered under your spouse’s employer plan, speak with the plan administrator to review your options.

Veterans’ Benefits

Spouse’s of veterans are generally eligible to receive burial expense benefits in the amount of $300 and up to $150 towards private cemetery fees. If you wish to have your spouse buried in a national cemetery, this comes at no cost to you.

If, prior to his/her death, you spouse was receiving disability benefits, your family may be entitled to continue those monthly payments. Your regional VA office can help you with any questions you might have.

Stay tuned for Part 3, where we address the next items on your to-do list. Don’t hesitate to contact us with any questions, at 1- 866-450-2424.

The Surviving Spouse’s To-Do List, Part 1: Paperwork

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The death of a spouse is one of the most devastating events you will endure in your life. To make matters worse, you are asked to make significant decisions about your loved one’s burial and your financial future. Whether you were the financial decision-maker or not, the stress and sadness felt from this loss can make even the simplest of decisions feel paralyzing.

Our first bit of advice: don’t make any major decisions until you’ve had a moment to catch your breath and adjust to life without your spouse. Financial advisors typically recommend waiting six months to a year before making major changes to your financial portfolio. Trust me, there are a number of items you will be tasked with that should keep you busy in the coming weeks and months. Your primary focus – healing from this devastating loss.

While the next few months should be centered on healing, there are a few decisions you must make to get your affairs in order. Part 1 of our 6-part series addresses the first item on your to-do list – gathering your paperwork. Do not expect to tackle this entire list overnight; it could take months for some of this paperwork to come in. Use this as a guideline as you map out a plan of action for this new life you have suddenly been introduced to.

Gather Your Paperwork

There are a few documents you will need to gather in order to collect your life insurance death benefit, any additional benefits, and to update your estate.

  • Death certificate- Order 15 – 25 copies of the death certificate from the local health department or funeral home. Your life insurance, bank, and financial institutions will require this when claiming benefits or making changes. Certified copies can be purchased through your local health department or the funeral home.
  • Social Security numbers- You will need the Social Security numbers of surviving members of the estate, as well as your deceased spouse’s.
  • Birth certificates- Make sure you have copies of the birth certificate for each dependent family member. Contact the county or state public health offices where each child was born to obtain a copy.
  • Marriage certificates- This is required if you plan to collect any surviving spousal benefits and can be purchased from the County Clerk’s office where the original certificate was issued.
  • Military discharge paperwork- If your spouse was ever discharged from the military, you will need a copy of their discharge paperwork (honorable or dishonorable). A copy can be requested online through the Department of Defense’s National Personnel Record Center.
  • Insurance policies- Gather copies of each insurance policy. Review them for any potential benefits and/or necessary changes.
  • Will- Wills are commonly stored with an attorney, in a safe, or safety deposit box. If you spouse did not have a will, his/her estate is dispersed in accordance with your state’s intestacy law. Any property titled in more than one name will automatically pass to the surviving co-owner.
  • List of assets- Gather a complete list of assets. This should include items in your name, your spouse’s name, and jointly owned.

Unless you took an active role in the day-to-day finances, the paperwork could start to feel overwhelming. Keep your stress level at a minimum by developing a document storage system that is organized and safe, yet out of eyesight. Make notes on the outside of envelopes whenever necessary and keep a running list of all bills. Continue to pay outstanding balances as they arrive, but inquire about any items listed solely in your spouse’s name. Some balances, like federal student loans, are forgiven in the event of the borrower’s death.

Stay tuned for Part 2, where we address the next items on your to-do list. Don’t hesitate to contact us with any questions, at 1- 866-450-2424.

What to Do If You Can’t Afford to Pay Your Life Insurance: Part 2

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Last week, we shared some options regarding what to do if you have found yourself in a difficult financial situation and are unable to pay your upcoming life insurance premium. Today, we wanted to offer a few more alternatives, as well as review some commonly asked questions.

Before making your final decision, take a moment to speak with your insurance agent. Each insurer has their own set of rules and guidelines – some of our suggested options might not apply to you and, you never know, your agent may have some more tricks up their sleeve that aren’t covered here.

Apply for Consideration of a Change in Health Classification

Remember when you applied for your life insurance policy, you took a medical exam and answered a series of questions? There are a number of conditions that could have impacted your rate classification and, in turn, your annual premium.

Were you a smoker at the time? Did you have cancer, that is now in remission? Depending upon the pre-existing condition, you may be eligible for a change in rate class. If your application is approved, you could receive a more affordable rate on your current policy.

Life Settlement

As defined by the Life Insurance Settlement Association, “A life settlement is the sale of a life insurance policy to a third party for a value in excess of the policy’s cash surrender value, but less than its face value, or death benefit.”

The third party agrees to pay all future policy premiums and receives any available death benefits when the insured passes away. Unfortunately, this option is typically only available to insureds over the age of 65 or for customers whose policy has accumulated enough cash value to sell their policy. Since each insurer (and policy) has their own set of rules, contact your agent to learn more about this option.

Frequently Asked Questions: How Can I Make My Life Insurance More Affordable?

Question: I really want to invest in a life insurance policy, but don’t think I can afford it. What should I do?

Answer: We have a few suggestions that might help make your policy more affordable:

  • Purchase a policy as soon as possible – The younger you are, the cheaper your life insurance policy will be. Plus, you never know what kind of health conditions could pop up unexpectedly. So, if you’re young and you do not currently have a life policy, start shopping now. Our website offers multiple options for figuring a rate quote or, if you prefer to speak with a person directly, an agent would be happy to discuss your options with you. Just give us a call at 1-866-450-2424.
  • Buy a term life insurance policy – Insurers understand that consumers need options to fit every budget. Term life insurance rates are the most affordable option, with term periods lasting anywhere from one to thirty years. Just keep in mind that, when the policy term expires, your rates will be significantly higher than your original investment.
  • Inquire about payment plans – As a rule, your insurance premium will be cheaper if you pay the full annual premium upfront. There are, however, options to pay semi-annually, quarterly, and monthly. These payment plans often have processing fees tacked on to the total, so make sure you have all the information before making your final decision.
  • If you are a smoker, quit ASAP – We aren’t here to judge you; everyone has a guilty pleasure (or two). As a smoker, however, your rates are guaranteed to be higher than as a non-smoker. When you are ready to quit, write your quit-date on a calendar you can refer back to. Depending upon the insurer and policy, you can reapply for a lower rate in one to three years.

Question: What are some of the situations that could cause my life insurance rates to be higher?

Answer: As previously mentioned, smokers automatically earn a lower table rating, which results in higher policy premiums. There are a number of other pre-existing conditions, however, that could affect your table rating. To learn more about what to expect during the paramedical exam and what they are testing for, visit our blog here. If you feel you will classify as a higher risk, discuss your health issues with an insurance professional. They can assist you in finding the best policy for the very best premium.

Question: I’m still not sure I can afford the premium. Is there anything else I can do?

Answer: A term life insurance policy is very affordable. Consider sitting down and evaluating your budgetary spending. According to the National Resource Defense Council, each household spends approximately $529/year on unwanted snacks. Is there anything you can eliminate or cut down on in your monthly spending? Our blog, 7 Everyday Things That Cost More than Term Life Insurance, should be a great place to start getting ideas.

Before making any permanent decisions, remind yourself why you purchased your life insurance policy in the first place. While you may feel lost and desperate right now, this situation is temporary. Work with your agent and/or insurer to identify all options available to you before making your final decision. Best of luck to you!

What to Do If You Can’t Afford to Pay Your Life Insurance: Part 1

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If you own a life insurance policy, you’ve already weighed every option and determined the value it stands to add to your portfolio. You’ve considered the financial strain an unexpected death could put on your family, and defined how much your dependents would need to survive, without your income. While we spend each day educating our clients on the importance of life insurance, we are still conscious of the fact that everyone falls on difficult times. And, when those days arrive, life insurance payments may become one of the first casualties.

Whether it’s the loss of a job or unexpected expenses, everyone falls on tough financial times at least once in their adult life. This is when we have to analyze the family budget and identify ways to cut back on spending. Since none of us have any plans to pass away anytime soon, life insurance is often the first part of the budget families consider slashing. After all, how can you worry about your family’s financial situation ten or twenty years from now, when you can’t even figure out how to get past today?

If you’re having trouble paying the premium and are considering canceling your life insurance policy, make sure you understand all the potential repercussions. Don’t make a hasty decision now that could significantly impact your family later, just to save a money in the short term.

Life After Death

When a family member dies, those left behind are often left with a great number of expenses. In addition to the mortgage and daily living expenses, there are funeral costs, credit card bills, and taxes. In fact, 62% of consumers polled indicated they would be financially strapped almost immediately, if the primary breadwinner passed away unexpectedly. While most companies are sensitive to a family’s loss, they would go out of business if they absolved the outstanding debts of everyone who suffered the loss of a loved one.

Far too many people allow their life insurance policy to lapse, without considering all their options. Most don’t even realize that they have any options at all. Let’s look at a few ways you can keep your current life policy in place, even when you can’t afford to pay your premiums.

Term Life Insurance

A term life policy covers you for a specified period of time. If you pass away during that period, your beneficiaries receive a death benefit. If you’re still here, once the policy period expires, no one receives anything. If you fail to pay the policy premium when it comes due, the policy will lapse and your beneficiaries will receive nothing.

If you own a term policy, there are a few options available to you:

  • Grace period: While you’ll need to check the specifics of your policy, most insurers offer a 30-day grace period. Just send in your payment within the grace period and the policy will continue on as usual.
  • Payment plans: Most insurance companies also offer the option to pay your premium in installments. If you currently receive a bill annually, or even semi-annually, call your insurer and ask what installment options are available to you.
  • Reinstatement of a lapsed policy: If you failed to make your premium payment within the grace period, the policy will lapse. Don’t get discouraged though, there’s still hope. Most companies will allow you to reinstate your policy after the lapse date. The rules very from insurer to insurer, so check with your agent or the company to find out their specific rules. Some allow for reinstatement up to five years, but do require the insured to undergo the underwriting process again.

Permanent Life Insurance

If you opted to invest in a permanent life insurance policy, you likely had a number of reasons for doing so. Unless your situation has changed drastically and it’s probably a good idea for you to keep the policy in place. Fortunately, there are a number of options for you to consider:

Use your cash value to pay premium: This option is best for insureds who have had a permanent policy in place for quite some time. In the initial years, the policy is slow to build up cash value. As time goes on, however, it does build enough cash value to make a significant impact on one’s financial situation. While we recommend holding off on cashing in until you’ve reach the goals you set when purchasing the policy, we also understand that unavoidable circumstances occur. And using the cash value to pay the premiums is certainly better than allowing the policy to lapse. Before selecting this option, be sure to discuss the long-term implications this could have on your policy. Using the cash value of your policy is considered a loan. If you don’t pay it back, the death benefit your beneficiary receives will be reduced and, in some cases, cause the policy to lapse.

Use your dividends to pay premium: If your permanent policy pays dividends on the policy’s investments, you may be able to use these to offset your premiums.

Reduce the death benefit: Many insurers allow customers to decrease the face value of the policy in exchange for a reduced premium. In some cases this diminishes the premium amount enough for the policy to be considered “paid in full.” In this instance, the policyholder is able to stop paying on the policy entirely.

Waiver of premium: Many policies include a waiver of premium rider, which allows the insured to stop paying on their policy if they meet the disability conditions set by the carrier.

Convert to a term life policy: While you would incur some cancellation feeds, converting to a term policy is another option for those carrying a permanent life policy. In this case, you would cancel the permanent policy, using the cash value to convert to term insurance. If you’re considering this option, just keep in mind that your new policy would only provide a death benefit should you pass away during the defined timeframe.

If you’ve found yourself in a financial predicament, remember – nothing in life is permanent. This too shall pass. Work with your insurance advisor and explore all your options before allowing your policy to lapse. Stay tuned for Part 2, where we explore a few more potential alternatives and answer some questions frequently asked by others in your same situation.

I’m All Set to Retire: Do I Really Need That Life Insurance Policy Anymore?

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Each of us has a different vision of what retirement will look like. Some plan to travel, while others hope to volunteer in their community or spend more time with family. You’ve spent all these years focusing on building a nest egg for your later years, it’s time to sit back and reap the rewards. For many, this means doing away with their life insurance policies. After all, there’s little to no income to replace should you pass on and your dependents are out of the house, right?

In many instances, this is true. However, what you do with your life insurance policy should be carefully considered before making any rash decisions. Let’s look at a few questions you should ask yourself when considering your options.

Have You Considered Estate Planning?

When a family member dies, those left behind are often left with a great deal of expenses – funeral costs and federal and state estate/inheritance taxes leave some heirs scrambling to sell off assets.

For individuals whose goal is liquidity, a life insurance policy such as an irrevocable life insurance trust can prove beneficial. The policy cannot be modified, revoked, or terminated for as long as you’re alive. Upon your death, proceeds are protected against creditors and estate taxation.

If this is something you’re considering, be sure to seek the guidance of an experienced life insurance agent or financial advisor.

Are You Still in Debt or Working?

Many consumers reach retirement age and are still in debt. Whether it be from failed business ventures, credit cards, or mortgage, this outstanding debt will still need to be paid once you pass away. Retirees who are still facing outstanding debt should consider their life insurance options. A guaranteed level-premium term life policy is a great way to protect your family against a mountain of debt upon your death.

Again, be sure to speak with a licensed professional before making any changes to your current policy, or committing to a new one.

Do You Have a Disabled Child or Other Dependent?

A retiree whose children are out of the home and spouse is self-sufficient might not have a need to continue their life insurance. However, if you have a special needs family member, their care after your death should be a consideration. Additionally, will your spouse lose a significant amount of your pension or other monthly income? If so, a life policy can help fill that gap.

Do You Wish to Leave a Charitable Legacy?

While consumers often choose to make annual donations to a charitable organization, many are now realizing the benefits of leaving a charitable legacy in the form of life insurance. When structured properly, your gift can benefit both you and the recipient, at a lower out-of-pocket cost to you.

Do You Own Your Own Business?

Business owners have a responsibility to more than just their family. They have employees and business partners to consider and, for many, their death could have a significant impact on those left behind. If you’re unfamiliar with key man life insurance, visit our blog for more details regarding this critical business tool.

As you approach the finishing line for your retirement planning, it’s important that you have the full picture regarding where you stand financially. Ask yourself:

  • What sources of income will I/we be reliant on?
  • What are our outstanding debts, including a mortgage?
  • Am I in good health? How is my spouse?
  • Who is dependent upon me and how?

Many view life insurance after retirement counterproductive, until they’ve considered these questions. While it may not be a necessary investment, you owe it to your loved ones to take a moment to examine your situation from every angle. And do not ever cancel an existing insurance policy without speaking with an insurance representative first.

Life Insurance Paramedical Exam: What Are They Testing For?

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Last month, we shared with you the details of what to expect during the life insurance application and paramedical exam process. Some of you may be wondering “But what exactly will they be testing for?” So, to add that last piece to the puzzle, we thought we’d provide some specifics regarding what underwriting is looking for.

If you have any health issues that come up on this list, please do not let this intimidate you. Negative results do not guarantee you’ll be denied coverage. However, if you’re feeling uneasy, please take a moment to share your concerns with us. Our job is to arm you with all the information and assist you in finding the very best policy, at the best possible rate.

Heart Conditions

According to the American College of Cardiology, cardiovascular disease (CVD) is responsible for almost 800,000 deaths in the U.S. each year, with one person dying every 40 seconds. Your blood work will offer underwriting insight into the health of your heart and arteries, through the following tests:

Cholesterol

Cholesterol is fatty matter that your body needs to keep everything lubricated. Your blood holds “bad” and “good” cholesterol. If it’s storing too much of the bad, it can cause serious health complications. The specifics regarding how much is too much varies from insurer to insurer.

  • HDL– High-Density Lipoprotein is that “good” cholesterol we mentioned earlier. It wards off LDL build-up in your arteries.
  • LDL – Low-Density Lipoprotein is what’s labeled as “bad” cholesterol. Accumulation of LDL in your arteries typically leading to blockage and, potentially, heart attack or stroke.
  • LDL/HDL Ratio – This ratio is used to define your risk for heart disease. The lower number = lower the risk.
  • Cholesterol/HDL Ratio – This is also an indicator of your risk for heart disease. Ideally, this number should read 5 or lower.

Triglycerides

Triglycerides are fat lipids found in your blood. Higher levels indicate an increased risk for heart disease. Levels of 150 or lower are preferred.

Diuretic In Urine

Your urine sample will be used to test for diuretics, which is an indicator that you’re currently on blood pressure medication.

Beta Adrenergic Blockers

Some insurance companies will test for beta adrenergic blockers, which shows if you’re on any blood pressure medication or being treated for heart defects or arrhythmias.

Liver

The liver is one of the primary producers of protein and cholesterol in your body. In fact, contrary to popular belief, only 20% of the cholesterol in your blood stream comes from the foods you consume; the other 80% is produced by your liver. These tests offer the underwriter insight into your risk for liver or muscle disease.

Alkaline Phosphatase

Elevated levels of this enzyme could indicate liver or some types of bone disease. Target readings are 30 to 100.

Aspartate Aminotransferase

(AST) Increased levels of this enzyme in your blood signals the potential for heart, muscle, or liver disease. Target readings are below 40.

Alanine Aminotransferase

(ALT) You may be at risk for liver disease if elevated levels of this enzyme are present. Target readings are 45 or lower.

Gamma Glutamyl Transpeptidase

(GGT) Higher levels of this enzyme are often present with liver disease and excessive alcohol consumption. Target readings are below 65.

Bilirubin

Elevated levels of bilirubin are an indicator of liver or gallbladder disease. Target levels range from .3 to 1.8.

Protein

Another indicator of liver disease; target levels range from 6 to 8.

Albumin

Lower levels are an indicator of severe liver disease and could be a sign that additional disorders exist. Target levels are between 3.8 and 5.2.

Globulin

Readings lower than 2.1 or higher than 3.5 could indicate an issue. Increased levels could be a sign of infection or immune system problems.

Pancreas

The pancreas works to produce hormones and enzymes that are responsible for regulating blood sugar levels and food digestion.

Glucose in Urine

The presence of glucose is an indicator of diabetes.

Hemoglobin A1c

This test provides a measurement of blood glucose over the last 90 days. Target level is 5.7 or lower. If your reading is 5.7 – 6.4, you’ll be considered pre-diabetic by the life insurance underwriter. If your levels are 6.5 or above, underwriting will view you as diabetic.

Fructosamine

This provides a measurement of your blood sugar levels over the past 2-3 weeks. Target levels are between 1.5 and 2.5.

Kidney and Bladder

The kidney and bladder are responsible for removing waste from your urine.

Leukocyte Esterase

This enzyme’s presence enzyme could indicate an infection.

Blood urea nitrogen

(BUN) This reading is used to calculate your overall health. Target levels are 10-25.

Urine PH Screen

This tests for the acidity of your urine. Target levels are 4-8.

Hemoglobin Screen

The presence of hemoglobin could indicate kidney infection or a UTI.

Creatinine

Elevated levels signal the possibility of kidney disease. Target levels are 0.7 to 1.5.

Proteinuria, Urine Creatinine, and/or Microalbumin

Presence of these in your urine indicates you may be at risk for kidney disease. Normal levels of urine creatinine are 25-250. They’ll also test your ratio, which should be between 0.0-0.20. Levels of 0.30 or lower are considered normal for microalbumin.

Serum HIV

Your blood will be tested for HIV, which is the virus that causes

AIDS.

Cotinine

Cotinine is the primary byproduct of nicotine. Presence signals possible tobacco use, ranging anywhere from 2 days to 3 months.

The paramedical exam is the underwriter’s tool for getting a picture of your overall health. This, combined with your application, helps the insurer identify you as a risk and set your premium. Regardless of what you fear these tests could uncover, don’t let this keep you from exploring your life insurance options. Discuss your choices with a licensed life insurance agent; we’re here to help you find the very best solution to fit your family’s needs.

Expectant Mothers – What You Need To Know About Life Insurance

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Expecting a child is one of the most exciting times in one’s life. You’re filled with hope for the future, daydreaming about what lies ahead for your family. With that little bundle of joy, however, comes an immense amount of responsibility. This little life will look to you for love and guidance; and every decision you make from this moment forward will be made with your child in mind. It’s only natural that pregnancy is the time many families start to consider their options regarding life insurance.

Life insurance provides your family financial security should you pass away unexpectedly. While this is something no one wants to think about, we owe it to our families to do what we can to secure their future, particularly when a child is on the way.

If you’re already pregnant, you’ve probably written off life insurance for now, assuming you’ll be denied coverage or, at the very least, be charged sky-high premiums. This isn’t always the case. Most insurers will insure a pregnant woman up to their third trimester. In fact, many insurance companies will issue a policy throughout the entire pregnancy, assuming the applicant fits the underwriting guidelines and there are no serious complications with the pregnancy.

When Pregnancy Complications Arise

If you’re pregnant, or considering bringing a child into the world, you’ve probably read about all the complications that could occur. Controlled gestational diabetes is a health-related condition that occurs only during pregnancy. Should you be diagnosed with this, don’t be discouraged. Many insurers will not only accept your application, they’ll issue your policy at Standard or Preferred premium rates (if underwriting hasn’t uncovered any other health concerns).

Conditions that often disqualify applicants include:

  • High blood pressure or preeclampsia
  • Difficulties with a previous pregnancy
  • Previous c-section birth

If you fit into one or more of these categories, discuss your options with your life insurance agent – it might be best for you to wait and apply after your child is born.

Advice for Obtaining the Most Favorable Rates

  • If you and your partner are discussing starting a family, consider applying for life insurance first. This will position you for the most favorable policy and rate.
  • Weight and cholesterol are both considered during the underwriting process. These levels often fluctuate during pregnancy and while breastfeeding. If you’re already expecting, discuss your options with an insurance agent – the sooner the better. But don’t make any rash decisions; take the time to choose the policy that best fits your families growing needs. A few days isn’t going to make a huge difference, but choosing the wrong policy could.
  • If applying pre-pregnancy is no longer an option, apply before you hit your third trimester.
  • Some underwriters factor in postpartum depression issues when reviewing an application. If you’re experiencing postpartum symptoms, discuss this with your agent. They can help you shop around for the best policy at the best rate.

Congratulations, you’re about to embark on the most fulfilling experience of your life. This should be a time of joy and hope. We understand that life insurance can be intimidating, even under normal circumstances. The peace of mind of knowing your family is cared for financially should the unexpected occur will far outweigh any stresses you might endure during the consideration and application stages. The Vista Life team is here to make the process as painless as possible. So you can get back to what matters most – enjoying your new family.

What to Expect From the Life Insurance Application Process

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We’ve spent the last few weeks educating you on the life insurance underwriting and paramedical exam process. But, what about the steps leading up to the medical exam? What can you expect from the application process and how long does it all take? Today, we’ll review each step in detail, hopefully preparing you for what lies ahead.

Step 1: Compare Quotes

Once you’ve spoken with an insurance agent and identified how much coverage you need, it’s time to start comparing quotes. Your goal is to identify the most financially secure company with the most affordable rate. While many quotes can be obtained online, it’s often time-consuming and overwhelming. Working with an independent agent is the easiest and most efficient way to comparison shop.

Tip: Don’t base your final decision on price alone. Only consider insurers who are rated A- or higher by A.M Best. Hopefully, your loved ones won’t need to cash in on that insurance policy for many years to come; you need a company that will still be around in 30 – 40 years.

Step 2: Application

Now that you’ve selected the policy that best fits your needs, it’s time to fill out the paper application. This is usually a fairly simple and quick process, lasting for 10 to 30 minutes.

You’ll be asked some basic information regarding:

  • Your health history
  • Family’s health history
  • Prescription medications you’re taking
  • Criminal and driving record
  • Dangerous hobbies you participate in

You’ll also want to come prepared with the following information:

  • Beneficiary information, including social security number and date of birth
  • Contingent beneficiary information
  • Your social security and drivers license number
  • Latest tax return income information
  • Your primary doctor’s contact information

Tip: Lying on an insurance application is considered fraud and could result in some serious penalties. Don’t offer any information that isn’t asked, but never lie.

Step 3: Paramedical Exam

Once your application has been submitted, a medical technician will contact you to set up your paramedical exam. You’ll be asked for additional information regarding your health and the nurse will check your weight, height, and blood pressure. They’ll also take urine and blood samples. This process should take between 15 and 30 minutes, depending upon the specifics of the policy you’ve applied for.

Tip: If you’re concerned about the medical exam, our blog goes into greater detail on what to expect and what steps you can take to better prepare yourself.

Step 4: Phone Interview

Some insurance companies require applicants to undergo a phone interview. This is a fairly painless and speedy step; plan on spending 15 to 20 minutes on the phone.

Tip: Again, don’t volunteer information that’s not asked of you. Answer the questions honestly and briefly.

Step 5: Underwriting

Once you’ve completed these steps, all the information that’s collected is forwarded to the underwriter. While this is typically the longest part of the process, it doesn’t require any action on your part. The underwriter will review the details of your application, medical, and personal history and assign you a health/rate class.

Tip: This can take anywhere from 3 – 6 weeks, sometimes longer if they have to request medical records from your doctor. It doesn’t mean there’s anything wrong or that you’ll be denied, so don’t start thinking the worst.

Step 6: The Decision

Once the underwriter has had an opportunity to review your information, the company will come back with a decision. Hopefully, your policy will be accepted at the rate you applied for. If it comes back “other than applied,” it can mean one of two things – you either qualified for a lower rate, or a higher rate.

Tip: If it comes back at a higher rate, discuss your options with your insurance agent. Some applicants choose to reduce their coverage amount or drop the policy term, while others opt to go with another carrier entirely.

Step 7: The Policy Takes Effect

Upon making your decision, notify your agent or the insurance company. Your policy will then be processed and forwarded to you for review. Once your signed policy and first premium payment have been received, the policy is officially in force.

Tip: Inquire about using a conditional binding receipt, which would put your policy in force immediately. Additionally, make sure you notify the beneficiaries that they’ve been named on your policy.

If your worst fears come true and you’re denied coverage, schedule a meeting with your agent to discuss your options moving forward. Don’t make the assumption that you’ll be denied with another carrier, as each company has their own set of underwriting guidelines. Many even offer policies that do not require a medical exam for a slightly higher policy premium.

Paramedical Exam Tips to Help Achieve the Best Life Insurance Rating

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Last week, we walked you through the life insurance paramedical exam process and answered some of the most frequently asked questions. Now that you know what to expect, we thought it would be helpful to share some tips to help ensure the best possible outcome. While you can’t control how chronic illness impacts the underwriting process, there are ways you can prepare to keep your rates affordable.

Here are some basic tips to help you prepare for the paramedical exam to ensure the best results:

1) Watch Your Diet Carefully

A week before your paramedical exam, pay close attention to the foods you consume. Since elevated blood pressure and cholesterol levels are the primary reason life insurance underwriters come back with an offer for a lower rate class, it’s important to control these numbers as much as possible. Reduce or eliminate your sodium intake, as it can elevate your blood pressure. Cut back on your sugar consumption, as it has the potential to increase your blood sugar levels. Avoid processed foods as much as possible, as these are typically high in sugar, fats, and sodium.

Instead, focus on foods that can positively impact your blood work. Leafy greens, such as kale, spinach, broccoli, and salads work to lower your cholesterol and blood pressure. Avocados, apples, oranges, olive oil, peanut butter, oats, orange juice, and fish are great options for raising your HDL (good cholesterol) level. While the underwriter reviewing your application will consider both your total cholesterol and your HDL ratio, they’ll offer some leniency on your total cholesterol IF your HDL ratio is excellent. Thus, focusing on improving your good cholesterol could help save you a lot of money in the long run.

2) Drink as Much Water as Possible

I’m sure, by now, you’ve heard the benefits of drinking water. This is not the time to slack on your water consumption. It will clean out your digestive system and urinary tracts, as well as increase blood flow. Additionally, drinking plenty of water ensures full veins, which makes it easier for the medical examiner to find a healthy vein to draw blood from.

3) Avoid Alcohol and Exercise Leading Up to the Exam

Elevated alcohol levels in your bloodstream could send a signal to the underwriter that you might have an issue with alcoholism. To avoid this, do not consume alcohol for at least 24 hours before the exam. If weight is a concern for you, consider eliminating alcohol for an entire week before the exam. This should help stabilize your weight going into the exam.

Normally, daily exercise is something we all strive for. It’s important to remember, however, that exercise can potentially elevate your blood pressure and protein levels in your urine. Twenty four hours before the exam, take some time to relax and shelf your exercise regimen. Once the exam is over, you can go back to your regular workouts.

4) Fast for at Least 12 Hours

When setting up your paramedical exam, the nurse will likely instruct you to fast for 8-12 hours. Doing so helps avoid false positives on your blood sugar and blood pressure levels, which can significantly impact your life insurance rates. If you’re concerned about fasting for that long, schedule your appointment for first thing in the morning. Once you’ve finished your exam, you can have that cup of coffee and bagel and get on with the rest of your day.

5) Advice for the Morning of the Exam

  • Drink a glass of water the morning of the exam. This will not only help you get through providing a urine specimen, it will also help hydrate your veins, making it easier for the examiner to draw blood.
  • For many, the very idea of having blood drawn can elevate their blood pressure. If you’re feeling a little anxious, ask the examiner to draw your blood first and check your blood pressure last. The time in between these two events is typically enough to let your anxiety subside and lower your blood pressure.
  • When it’s time to get your blood drawn, keep your arm straight and your elbow locked. This allows your veins to pop out, ready for the needle, and reduces any pain you might experience.
  • Wear light clothing and stand tall. It sounds crazy, but sometimes the difference between one rate class and another is a pound or two. By standing tall and dressing light, the examiner will get an accurate reading of your weight-to-height ratio.

If you’re still concerned about the findings on your medical exam, share your worries with your agent. They can match you with an insurance company that won’t penalize you as heavily or set you up with a policy that doesn’t require a medical exam.

Once you’ve completed your paramedical exam, it’s time for the rest of the process. Visit our blog next week as we prepare you for what to expect throughout the application process.