This article explores various insurance options available for clients who believe they are uninsurable due to health issues or other factors. It discusses simplified issue insurance, guaranteed issue insurance, the secondary market, and converting existing group insurance policies. The article also highlights the importance of consulting with insurance brokers and financial planners to find the best coverage solutions.
Simplified issue, guaranteed issue and converting existing policies may be insurance options for clients who feel as though they have none.For starters, clients shouldn’t assume they won’t qualify for any coverage, says PJ Lynch, partner, insurance and estate planning at Cox Financial Group Ltd. in Lethbridge, Alta. Some clients may assume they’re out of luck due to a past critical illness, he notes, but brokers research multiple policies, all with different criteria for approval.
For complex cases, he looks to the secondary market. Simplified issue insurance offers limited coverage and higher premiums, but has a limited health questionnaire. He emphasizes reading the fine print as some policies have a two-year waiting period for those with pre-existing conditions. If a client with a pre-existing condition dies during that two-year period, the insurance company refunds the premiums, he says.
Andy Kovacs, certified financial planner with Moments of Truth Insurance Services Corp. at Sun Life Financial Investment Services Inc. in Markham, Ont., says simplified issue insurance allowed him to fill a gap before a client’s next medical. He says the client had a health issue and was referred to several specialists. With the simplified issue policy in place, the client applied for a more traditional policy that offered more coverage for his business and personal needs.
For couples concerned about estate planning, she says joint-last-to-die insurance policies, which pay out on the second death, may be an option. The face amount can help with paying funeral expenses, probate and estate debts, she says, in addition to providing money for heirs. To qualify for this insurance, only one of the two spouses needs to be healthy.
INSURANCE HEALTH FINANCE ESTATE PLANNING COVERAGE
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