Replacing Your Employer-Sponsored Life Insurance: For People with  Family Cancer History

By James Tobin, CFP

Critical Takeaways

  • Family History can negatively affect rates with the wrong carrier
  • An Independent agent can choose  the carrier that is the best fit for your situation

Workers Bequest Difficulty Rating

Expert Review Of  Life Insurance With  Family Cancer History

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Reviewed by

Jim Tobin, CFP®

Why you can trust this review

At Workers Bequest Life Insurance, we value our editorial independence. We keep our reviews strictly factual so you can use them to make informed decisions. Life insurance carriers referred to on this site do not approve reviews. 

If you have had your family's life impacted by cancer of a parent or sibling, you know all about the emotional and financial toll it can take.

What you  may not know is the impact it may have on YOUR life insurance application.

If your family has a history of cancer, particularly a death before age 60 or 65, you opportunity to obtain the best health class will be significantly limited.

The purpose of this article is to give some background on how family history impacts life insurance ratings and get the best deal that you can get with regards to upgrading your Employer Sponsored Life Insurance plan.

Additionally, the best company to compare your work-based plan to the private market is Workers Bequest. See our best careers and, avoid physical examinations in most cases.

What Is A Family Cancer History?

If that sounds like a stupid question, you need to understand it is meant in the context of life insurance underwriting, 

Life insurance carriers all have different rule for how a family history affects an application

 For instance, some carriers will consider your parents but not siblings. Other carriers will will not be concerned if  the cancer didn't cause a death until after age 65. 

So. in the context of life insurance underwriting, the answer to the question  "what is a family history of cancer" is not so straight forward.

In fact, the answer is specific to the carrier underwriting the application. 

Why Does A Family Cancer History Affect Your Health Class?

So you  understand that insurance companies charge more for people who have a family history that includes cancer, but think it should matter more that you are in great shape. 

The good news is that there are a few carriers that agree with you, however most do not. 

In spite of the fact that you may be perfectly healthy, or that your parent who got cancer smoked and lived a lifestyle that did not promote good health, insurance carries often just look at the actuarial charts.

Cancer  affects about 8% of the population directly and is the second leading cause of death i the United States. the Centers for Disease Control (CDC) estimates that between 5-10% of all cancers stem from inherited genetic mutations. 

What Is The Underwriting  Impact On Life Insurance With  Family Caner History?

The impact on your underwriting class if you have a family cancer history is also carrier specific.

Several carriers will not allow a a rate class better than standard if you have parents or siblings who succumbed to cancer prior to age 65. 

This means that if you would have been "preferred plus" (best class) you'd get knocked down 2 levels to "standard". However, if you were already "standard', you would stay there and not be further penalized.  

There are some carriers who are far more concerned with a history of heart disease than cancer and will flag your file for a family history of  heart disease but not cancer.  

While several carriers will "ding" your rating for having a family history that include cancer, none of them will require an attending physicians statement (APS) as a result.

How An Independent Agent Can Help With A Family History Of Cancer

Since underwriting guidelines vary significantly across different companies, it’s important to use independent insurance agencies such as ours to bag the best possible deals.

We’re speaking the truth, honestly.

There are captive agents and then there are independent agents. The former are tied to a specific carrier and tend to send all their clients to a single company since that nets them greater financial incentives. They often disregard the true needs of their clients due to financial incentives. On the other hand, independent agents have access to over 50+ insurance companies, allowing them to serve both themselves and their client’s interests for a win-win solution.

For instance, Prudential might be more receptive to insurance applicants with cancer compared to Protective, resulting in the former assigning you a more favorable underwriting grade.

An independent agent knows which carrier will provide you with the best deal, underwriting terms, and grade, thus helping you get the cheapest possible deals that provide maximum benefits. On the other hand, the policies suggested by a captive agent may not always be the cheapest one on the block.

Can’t really blame the fella – he’s got to earn a living too, eh? But an independent agent will suggest you policies that allow both of you to win.

Case Study: Life Insurance With Family History Of Cancer

Please see the case study below . it will show why it is in your interest to have as many options as possible available when shopping for life insurance with family history of cancer or any other impairment.

Gender: Male Age: 43

$500000 20 Year Term

Tobacco: No

 No  Health Concerns

Family history of Cancer (Mother died at 67 From Lung cancer)

This looks like a standard/preferred case that might get a better rating with one or two carriers. depending on the insurers appetite for a family history of cancer risk.. Let's take a look at the rates.

  • Standard Rates
  • Table 2/B Rates
  • Table 4/D Rates

While we’ve only presented a few life insurance companies and their rates here, it will do to illustrate our case. At first glance, Prudential’s standard rates are 12.5% costlier compared to Lincoln.

People new to the process  might be tempted to opt for Lincoln immediately and close this chapter.

However, things aren’t so simple. This is a great choice – yes, if you have no serious conditions or a concerning family history. If you’re assigned the same grade, it’s a no-brainer.

But things get complicated when you have health conditions or a concerning family history since that could adversely affect your ability to qualify for the cheaper policy.

As life insurance companies have different risk appetites, they will classify you into different underwriting grades, depending on their internal policies. Thus, while you may be eligible for a Preferred Plus rating from Prudential, which has more benefits, you may only be able to qualify for a Standard rating from Lincoln, which has fewer benefits and provides poor value for money compared to the other choice.

That’s a staggering difference of 50% when you compare Lincoln @ Standard and Prudential @ Preferred Plus. See how much you can save when you have an independent agent working for you?

Your Next step

We are glad about the efforts you've made on checking out for a better upgrade for your Employer Sponsored Life Insurance Plan and finally decided on Workers Bequest. We are committed to a totally transparent process (we'll even share our computer screen with you if you'd like), and making the application process as painless as possible.

Simply give us a call or shoot an email over and we can get you started. If you have any questions, We'd also like to hear them.

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