I am always a bit disheartened when an application for life insurance is submitted as a preferred rate classification and, after gathering the appropriate medical information, we find a client has health risks that will reduce his life expectancy. Even though the case may end up coming back as a Table 2 or Table 4, once a client is presented with the rates, he does not take the coverage.

No matter whether the coverage is not taken because of cost or pride, the worst part is the client loses sight of the reason he went through the process in the first place—to protect loved ones in case of his unexpected death. Ironically (unfortunately), having a health impairment of some kind could contribute to such an occurrence.

Having a rated case is not a reason to give up. As an advisor, you should be pleased to be able to provide your client with coverage.

Attitude is important: To be effective in delivering a rated policy, you must have a positive attitude regarding the rate. Underwriters who represent insurance carriers assess risk in great detail in order to assign a specific rate for each applicant, so you should be confident that the rate given to your client is fair and equitable.

Here are some facts that can help you be successful in placing a rated policy. Basically there are three things that can happen:

 1. Your client can die prematurely. If that happens, the family will be infinitely better off and will certainly not ask if the case was rated.

 2. Your client’s condition could grow worse. If he has a questionable health condition, he could be in the best health right now. Plus, as he gets older and his health deteriorates, life insurance will become more expensive or not available because he has become an unacceptable risk to the insurance carriers.

 3. Your client’s condition could improve. Perhaps through surgery or a change in lifestyle he might be able to improve his condition. At that time, he could request a reduction in premium and the carrier would be willing to review the improved medical history and perhaps lower the rates.

If rated coverage is unaffordable for your client, look at alternatives. Reduce the face amount or offer 15 year level term instead of 20 years.

Bottom line: Make sure your client is fulfilling his primary need by having that insurance safety net for his loved ones. 

Cindy V. Gentry, CLU, ChFC, LUTCF

BBA Life Brokerage Agency

CLU, ChFC, LUTCF, is president of BBA Life Brokerage, an independent life and annuity brokerage agency. She began her insurance career in 1980, and has been in marketing and management with BBA Life Brokerage since 1987.Most of Gentry's insurance career has been in the brokerage business, starting as a service representative in the group health business. She moved to Texas in 1982, and landed a position with a small health brokerage, later moving on to personal production, then joining BBA Life Brokerage.Gentry has been an active member of Corpus Christi Association of Insurance and Financial Advisors since 1989, serving on the board and executive committees and ultimately as president of the local chapter in 1996. She is a member of the Society of Financial Services Professionals. In 1997 she was presented the “Agent of the Year” award.Gentry has served as education chair of the National Association of Independent Life Brokerage Agencies (NAILBA), going on to serve on the board in 2000, on the executive committee in 2001, and serving as chairman for NAILBA in 2004. In 2007, she was presented with the inaugural NAILBA Education Excellence Award. Gentry served as the chairperson of Life Happens in 2014, a nonprofit organization formerly known as the LIFE Foundation.Gentry may be reached at BBA Life Brokerage Agency, 4838 Holly Road, Suite 102, Corpus Christi, TX 78411. Telephone: 800-747-4445 or 361-993-3820. Email: cindyg@bbalife.com.