Not meaning to trigger the end-of-day cult members who live in bomb shelters they’ve built at the end of their gardens, but we’re all gonna die.
Unless, of course, we go full Black Mirror and start migrating memories onto servers or creating robots finetuned with the personalities of the dead.
Which would lead to a verrrry murky list of terms and conditions for insurance companies!
A vaguely related case in point: a prisoner has made headlines around the world because he briefly died – and he’s arguing that he’s now served his life sentence. Folks, don’t try that one at home to get a Life Insurance pay-out.
Anyway, you may think that insurers don’t turn people down – that they’re always happy to take your money.
In actuality, they can and do turn people down – sometimes you’re postponed for life insurance (basically a ‘try again later’) but other times it’s an outright no.
This article was inspired by an email from a woman called Annie, who wrote in:
Hi. My Life Insurance has been postponed, and I need it for a mortgage and am wondering if there is Life Insurance out there that I can get?
Obviously, for Annie, this is not good. Annie’s done the hard part and saved the deposit and went and found a house to buy. However, to buy a home in Ireland, you have to get Mortgage Protection, which pays off your mortgage to the bank if you die.
As we all know, we love the banks here so very much, and that’s why we look after them so well.
Anyway, Annie can’t actually buy the house until she gets Mortgage Protection, so you can see why she’s in a pickle.
In Annie’s case, her postponement isn’t a hard no – it’s because something made the insurer pause and consider that the risk is too high, so they may ask her to change some things or do some things and then reapply.
There may be several reasons her application was postponed:
Remember: insurers don’t actually want you to die!
They want you to pay your premiums for however long your policy is so they can scoop up all your money without having to pay-out a big ole lump sum. A pre-existing condition could be any number of things – from cancer to obesity or diabetes.
After a certain amount of time has passed or the once the tests have taken place, the insurer will give a ‘yes’ or ‘no’.
Just a note here in case you’re confused: we’re using the term Life Insurance and Mortgage Protection interchangeably. Mortgage Protection is a type of Life Insurance.
The big difference is that if you’re trying to get Life Insurance and you’re postponed, it’s not the end of the world if you’re delayed six months.
However, if you’re getting a mortgage and your Mortgage Protection is postponed, you may lose the house you want. That’s why mortgage protection requires much more urgency than life insurance.
This means it’ll also change how you react to the postponement.
The first thing you should do is find out why you were postponed for Life Insurance. Ask the Chief Medical Officer (CMO) of the insurance company that postponed you to write to your GP with their reasons why letter.
Once the GP receives the letter, have a chat with them to see how they feel. Usually, you can tell by their reaction whether it’s worth appealing.
Your options if postponed:
In the case of Mortgage Protection, you’re going to lose the house unless your bank allows you to sign a waiver. See below.
(BTW If you have any kind of medical issues, apply for Mortgage Protection BEFORE handing over a non-refundable deposit.)
Each insurer handles each case differently. This is especially true if you’ve been postponed because of a medical thing. Every insurance company has an underwriting department who do the maths and consider the risk on each application.
Some of the insurers treat specific illnesses or medical issues much more sympathetically than the others. What I’m saying is that just because one says no, another may not.
Just be prepared to pay a little more for the luxury of the insurance.
Basically, it’s a bit like Tinder for insurance. The more insurers you apply to, the more likely you are to get a match.
Swiping right on all those insurers and their different policies can get time-consuming fast, so consider working with a broker who works with all the insurance companies. If you have a medical issue, be sure to work with a broker who has ample experience in that field. And make sure they deal with all the insurers.
Also make sure you know the ins and outs of your medical condition, even better if you can share medical reports. The more information you have for your broker, the better set you’ll be.
They’ll use their nous to present your case to the most sympathetic insurer to increase your chances of nabbing mortgage protection and buying your dream home.
If you can’t get cover and you can prove this by showing the bank your postponement/decline letter, the bank may allow a waiver.
This is a piece of paper you sign confirming you understand the consequence of getting a mortgage without life insurance.
i.e. if you die, the mortgage will not be repaid but your partner will have to continue to pay it from their income.
Usually, the banks will only allow waivers in the following scenario:
From Citizens Information
Exceptions to the legal requirement
You do not have to take out mortgage protection insurance if:
You are aged over 50 or
The mortgage is not on your principal private residence (your home) or
You cannot get the insurance, or can only get it at a much higher premium than normal or
You already have enough life insurance to pay off the home loan if you die
However, AND THIS IS THE KICKER, some lenders may insist that you take out mortgage protection insurance as a condition of giving you a mortgage, even if there is no legal requirement.
Basically, waivers are at the discretion of the lender.
Most postponements will be because of medical issues.
Undoubtedly, this is a bit shit.
You’re the exact person who needs Life Insurance, not yer man up the road who is 33 and runs marathons for the craic.
Of course, Runner Man is just as likely to be hit by a bus and wiped out – but you get my point. The insurers are awful sneaks when it comes to illnesses and pre-existing conditions.
The extent to which your health will affect your insurance comes down to the following:
If it’s a mild condition, you’ll probably have no kickback.
If it’s moderate, you’re gonna have to pay more, and you may be postponed.
If it’s a severe case (all the bad stuff no one wants to think about), any cover may outright be denied, or you’ll have to trade-off with a seeeeeeriouus premium increase.
Your GP will probably also have to complete a PMAR (Private Medical Attendants Report) – which is a medical questionnaire asking things like:
From there, you can see how an insurer would reassess your case.
If you are trying to apply for Mortgage Protection and you’re hit with a postponement, it doesn’t mean you definitely won’t get the house you’ve fallen for. Or at least the home that’s not entirely falling apart based on the catastrophic housing situation in Ireland right now. Still, I’d be lying if I said it won’t affect your chances.
Your best bet is to follow the steps I outlined above and to see how it works out.
If all else fails, you’ll just have to roll the dice again down the line.
There will be other houses, and probably a better one.
I promise it’s not all doom and gloom!
Annie isn’t alone. And neither are you.
We’ve helped lots of people who have been postponed for Life Insurance in the past.
I’m not saying it’s easy, but it is possible.
If you don’t have a broker, I’ll be glad to help.
Call me on 05793 20836 to discuss your application in confidence.
Don’t worry: we deal with the more difficult Life Insurance cases every day, so we know what we’re talking about. Just take a look at our testimonials.
Here’s two to save you a click:
We can do that for you too.
If you have been postponed, complete this short medical questionnaire and I’ll be right back.
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