Pehaps you once had a standard life insurance deal, but your circumstances have changed now as you need more cover. This does not mean a IFA or Broker still cannot help you.
Non standard life insurance or impaired life insurance, means anyone who may not be able to make a standard application due to perhaps the following;
All these insurance risk factors may lead to a reduced life expectancy, so a much greater likelihood of claim. Insurers may view them as higher risk.
So they may well increase your premiums, apply special terms permanently or for a time period or apply ‘exclusions’.
Non standard life insurance rates or terms offered will vary between insurers. So what other options are available ?
Guaranteed Insurability Option GIO
What happens if you have cover already but just need to top this up. Before applying for more cover, we suggest you relook at your existing standard life insurance paperwork. It could be that you have a GIO option allowing you to increase your cover without further medical evidence. This feature could save you money.
Convertible Term Insurance
Convertible term insurance has a 'conversion benefit option' which allows the insured policyholder to convert the cover under the policy into a new policy. This could then run for a longer period of time, without the insured having to undergo a medical examination or supply evidence of good health at the time of the conversion. It is usually more expensive than just term cover as you pay for the convertible option.
Renewable Term Insurance
Renewable term assurance allows the flexibility to renew your plan regardless of your any health issues at renewal.
For example, you take out your term assurance for a set term eg; 15 years, but include the renewable option. At the 15-year anniversary you will have the option to renew the plan free of underwriting (ie, no further health questions) for a further 15 years.
It is usually more expensive than just term cover as you pay for the renewable option.
So any individual, who cannot be granted an insurance policy under normal rates of premiums but can be granted with an extra premium over normal rates of premium, is considered as a Non-Standard Life.
NON STANDARD LIFE INSURANCE Types
NON STANDARD LIFE - WHOLE LIFE COVER
A whole of life policy that will always payout whenever death may occur. Premiums maybe reviewable in the future.
NON STANDARD LIFE - MORTGAGE PROTECTION
Designed to cover a repayment mortgage on death or critical illness as it decreases during the plan term.
NON STANDARD LIFE - LIFE INSURANCE
Offering family protection if the policy holder dies or is diagnosed with a terminal illness during the term. Plan can be guaranteed or reviewable premiums.
NON STANDARD LIFE - CRITICAL ILLNESS
Helps ease financial worries if you are diagnosed with a critical illness as specified by Insurers
NON STANDARD LIFE - MEDICAL INSURANCE
Providing private medical cover for you & your family.
NON STANDARD LIFE - INCOME PROTECTION
Providing security by way of an income if you are off sick or have an accident or disability.
NON STANDARD LIFE - BUSINESS PROTECTION
Offering company protection for a key person, loan & share protection or an employee dies, is diagnosed with a critical or terminal illness during the term
NON STANDARD LIFE INSURANCE - Frequently Asked Broker Questions
Can you make changes to your Non Standard Life insurance policy ?
In terms of changing your impaired life insurance policy, often you can request some of the following
What if my health or lifestyle changes after I have taken the policy out ?
Life Insurance cover is based on full disclosure at the time you took the policy out ie; being 100% as honest & accurate as possible. So any health or lifestyle changes since usually does not void your existing policy, as it wasn't relevant at that time of initial application. Please check your original T&C's
How do I make a Death Claim ?
Check firstly if premiums are still being paid or alternatively is the policy perhaps "paid up" meaning no further premiums were needed.
Then contact the Insurers claims line to inform them. They will provide you with their claim form for completion. You will need to send in a number of documents, most importantly being the death certificate proving the cause of death.
Insurers ( as well as other Providers ) will need the original death certificate, so ideally ask for several certified copies. Enclose your policy document, if you can find it and then send by recorded delivery or registered post to Insurers.
Once received, the Insurers usually cross check all information before processing and settling a valid claim ie; was the medical & lifestyle information correct at the time of original application
If everything is hopefully in order, the Insurer may pay out a claim & usually in a matter of days or weeks.
Death Claims, Trusts & Life of Another
Who the life insurance maybe actually then paid out to can be more complicated & many people wrongly assume it is a simple process.
If it is a joint life 1'st death policy or if it single life policy owned by another person " life of another" then it will just be paid to the survivor.
However, if it is a single life policy it can be more complex. Check if the policy was setup & written into a trust. If so the Insurer will pay the life insurance via the trustees named to the nominated beneficiaries directly. Sometimes there are a named beneficiary & others times a list of potential beneficiaries. The life insurance paid out doesn’t have to be included in the legal documents sent for probate and potentially it won’t be liable for inheritance tax either.
So should I put my non standard Life Insurance policy into Trust ?
If the life insurance wasn’t written into trust, it will be paid to the executors of the deceased’s estate. They will handle the administration, known as probate in N Ireland, England, Wales and confirmation in Scotland. If not, the benefits will fall into your estate if you died prematurely. If you have not made a will this can then cause further complications with the life insurance monies.
Until probate is fully granted, no monies can be paid out to those named in the will. On average, this can take upto 6 months. By not placing the plan into trust may also swell up the total estate values, leading to potentially Inheritance Tax IHT issues
So placing a policy in trust can help to ensure that the policy proceeds go to the correct beneficiaries you decide to nominate at that stage & help avoid possible probate delays & IHT costs. Ask the Insurers if they provide any standard trust form wordings & seek legal advice if unsure.
How do Life Insurance Companies proove you are a smoker or non-smoker ?
How do Insurance Companies know if you smoke ? On your doctors notes you declared yourself a smoker or non-smoker. So on the life insurance application, there is no point in lying when you apply, as your policy may not payout & you could waste the premiums and leave your family devastated.
If I started smoking after taking out Life Insurance - Do I need tell them ?
If you had legitimately stopped smoking for over 12 months at that time of original application, you may wish to advise the Insurers you have started smoking again - but this should not affect the original policy terms which should still stand - you were being honest. Also maybe suggest letting your GP know if this is the case.
FOR PROTECTION PRODUCTS WE USUALLY OFFER FROM A RANGE OF PROVIDERS
Non Standard Life Insurance Quote