Life insurance, by its very nature, is deeply personal. It transforms the vulnerable into the secure.
It can also leave you wondering – how does that all work, anyway?
Keep reading for answers to a few curious questions you’ve probably wondered about life insurance… but were too afraid to ask.
Q: I have a dangerous hobby. Can I still get life insurance?
A: In many cases, yes – but expect to answer some questions and (probably) pay a little extra to account for the additional risk.
Before giving you a quote, your local insurance agent may ask you to fill out a written questionnaire to understand more about your hobby. At ERIE, that includes hobbies such as:
Vehicle racing (stock cars, drag racing, motorcycles, etc.)
The questionnaire will ask you some basic information to understand your hobby. This could include:
How long you’ve been doing this hobby
How frequently you participate
Any training, education, or certifications you’ve received
If you ever get paid or hired for your hobby (as opposed to just doing it for fun)
Future goals or plans for your hobby
It’s important to be honest when filling out your questionnaire. If you fudge the details in an attempt to seem less risky… that could be grounds for denying a claim later on. Your completed questionnaire is sent to the life insurance underwriter, who determines the scope of the risk – and ultimately helps calculate the rate you’ll pay.
For example: Let’s say you’re into rock climbing. Does that mean you climb indoors with friends once in a while at the local gym? Or are you planning a trip to the Himalayas to go ice climbing alone? Similarly, if you have a private pilot license – are you taking occasional short trips for business? Or are you regularly stunt flying in air shows on the weekends?
You get the idea… it’s all about calculating that risk.
Q: If I quit smoking, can I get re-rated to save money on life insurance?
A: First things first: Good for you!
As for your life insurance: Generally speaking, yes – you can ask your local agent to get your existing policy re-rated. Before you do, though, you’ll likely have to show some stability in those lifestyle changes for a year or two to prove that you’re in this for the long haul.
What happens next may differ, depending on the circumstances. (Your agent can explain the specifics as they pertain to you.)
If you quit smoking because you’re just ready to live a healthier lifestyle – great! With no complications, you could get bumped from the “smoker “to the “nonsmoker” rate classification (and likely save some money in the process).
But, if you quit for a medical reason – such as a diagnosis of COPD or lung cancer – that’s a health concern that could impact the cost savings you’d otherwise see from quitting smoking. Your agent will ask you to fill out a questionnaire to get the specifics on why and how you quit.
Q: What if I lose 50 pounds? Could I get re-rated then?
Similar to the smoking example above, expect some follow-up questions about your weight loss. For example: “How and why did you lose the weight?” There are risks that come with weight loss surgeries, such as gastric bypass or lap band surgeries. Similarly, if you dropped a bunch of weight without even trying to… that could be the sign of a worrisome chronic illness or depression. If you start or stop taking certain medications because of your weight loss, that could also affect your rate.
But what if your weight loss is the product of good ol’ fashioned discipline, diet, and exercise? Once you show you can keep it off (and provide any necessary test results and information), you could get bumped to a more favorable rate class.
Remember, insurance rates are all about data and probability. When it comes to weight loss, most carriers will add at least 50% of the weight back when they calculate your new rate. Why? Statistically speaking, if you drop a bunch of weight, studies show you’re likely to gain at least some of it back.
Ask your ERIE agent about re-rating your policy if or when your circumstances change.
TALK TO A LOCAL ERIE AGENT FOR A LIFE INSURANCE QUOTE
Have a weird or embarrassing insurance question? Don’t be shy: Our local agents are licensed professionals – they’re not here to judge.
Talk to your local ERIE agent to get the conversation started.
ERIE life insurance products and services are provided by Erie Family Life Insurance Company (home office Erie, PA), a member of Erie Insurance Group, and are not available in New York.
A better insurance experience starts with ERIE.
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Contact Wilson & Associates IPM today to experience the ERIE difference for yourself.