By Lisa Morris, VP of Underwriting and Development at Partners Advantage
After spending 17 years working at life insurance carriers assessing large face amounts, the opportunity to move to the field presented itself and I jumped at the chance. The one observation that has been consistent can be narrowed down to one phrase: “What carrier is good at ___________”? (fill in any medical condition, avocation, aviation, etc., your choice!). My answer from both the carrier side and the field side has been the same…EVERYBODY! Everybody? Yes, everybody.
The majority of carriers use one or two of the available four reinsurance manuals. In addition, a few carriers may have some variances in which they can deviate a bit from the manual, but that happens after a carrier has shown a decline in a risk (either due to their mortality experience or new medical advancements). So if there are only a few manuals which all insurance carriers utilize, why do carriers market “sweet spots” or “niches”?
Perhaps the reason is related to how the carrier or product is positioned, perhaps how it is understood by the sales field, but whatever the reasoning, the end result is wanting to encourage you to think of their company when faced with certain underwriting issues. If you really give it some thought, you realize it is unlikely a medical condition could be a plug-in and go scenario. Why? In my 25 years of underwriting, I have never seen any two cases alike. In addition, physicians even have different interpretations or analysis of exams, conditions and treatment. Even in the case of twins with the similar DNA, they may not have the same medical condition and same treatment. So the question remains of how could a carrier indicate a sweet spot?
Individual life insurance underwriting is just that - individual. There is no cookie-cutter approach to medical conditions that can be applied to each and every applicant who has been diagnosed with that condition. No two clients are alike, so there is no set rule to evaluate their eligibility as if they are alike.
Do you have an underwriter with experience on your side? Partners Advantage can help. Read the full article which first appeared in Broker World magazine's November 2016 issue.
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For financial professional use only. Not for use with consumers.
Partners Advantage Insurance Services and their representatives do not give tax or legal advice. The material in this article is provided for informational purposes only and should not be construed as tax or legal advice. Discussions of the various planning strategies and issues are based on our understanding of the applicable federal income, gift, and estate tax laws in effect at the time of publication. However, these laws are subject to interpretation and change, and there is no guarantee that the relevant tax authorities will accept Partners Advantage’s interpretations. Additionally, the information presented here does not consider the impact of applicable state laws upon clients and prospects. Guarantees and benefits are based on the claims-paying ability of the issuing insurance company. Keep in mind that most life insurance policies require health underwriting and, in some cases, financial underwriting. Each case is individually underwritten as the severity of medical conditions varies among individuals. Formal underwriting evaluation and pricing is based on the individual characteristics of each case.