In reviewing my database of clients it became obvious that a large block of my business, something around 25% are life insurance for clients with some form of mood disorder. This is significant because it means the word really is getting out that life insurance company abuse of this underwriting topic is the norm and unless you’re using an independent agent things are not likely to go too well.
The first case I ever wrote about in this forum is one that still plays out badly for clients today. I had written about a doctor who had been practicing medicine for 6 years since she completed her residency. In case you’ve never watched Gray’s Anatomy, a television show about a teaching hospital, that time spent as a resident is long hours and high pressure. It’s got to be stressful as you actually take people’s lives into your own hands. So that client had been given an anti anxiety med which she took for about a year and discontinued when she left the residency program. It was given to her by a staff doctor at the hospital so there weren’t any records but she answered the question on the application through Selectquote honestly and was rewarded by being approved at a standard rate.
This person took an anti anxiety med for a short period, at a time that is undeniably stressful. She hadn’t taken anything in six years and still got a standard rate, a rate that was higher than she should have been able to get even if she was still on the medication with a well controlled anxiety disorder. This young lady was carrying $1mm of term insurance and had actually had to go with less life insurance than she wanted because of the price at standard rates. We shopped this and found that most of the companies I represent felt like standard was overkill and three companies felt like she should be approved at the best rate class they offered, and she was. This allowed her to get the $2mm she needed and still pay less than the $1mm at standard rates.
That blog post opened the flood gates of people who had been abused all the way from highly rated to declines in some cases where it could be shown by the life insurance underwriting facts that whether physicians, attorneys, home makers or CEO’s, their mood disorder was well enough controlled that unless they told you about it, you would never know. This kind of treatment spread with a core group of life insurance companies in cases involving well controlled anxiety disorder, situational and mild depression, ADD and ADHD and bipolar disorder 2.
Even though there has been some backpedaling on impaired risk underwriting of mood disorder life insurance by a few companies in the last year, there are still plenty of companies that will give fair hearing to reasonable situations. There are underwriters out there that I suspect have actually been through their own issues with mood disorders and understand that with treatment and control there truly is no mortality risk that deserves the rate bumping that some companies feel justified in.
Bottom line. It’s been a blessing to my clients and to my business to have found this weak link in the industry and also an eye opener to other areas where underwriting is straying away from assessing true mortality risk and taking the easy way of just approving all with a certain label the same. If you have been the victim of underwriting mistreatment for mood disorder treatment, and can show that your situation is well controlled and not destabilizing your life, call or email me directly. My name is Ed Hinerman. Let’s talk.