If your application for life insurance is denied, it means that the life insurance company you applied with isn’t able to offer you coverage. But because each company uses its own guidelines to assess risk, you may still be able to get life insurance coverage with another insurer.
Once you understand why your original application was not approved, an agent can take that information and help you shop around to find a company that can offer you the coverage you need.
7 reasons why you could be denied life insurance
After you apply for life insurance, your application will be evaluated on multiple factors — such as hobbies, family history, health, and age — to determine your risk.
Each insurance company calculates these factors differently. One company may decline you because you have specific health issues — for example, diabetes, or kidney disease — while another may accept your application and offer you the cheapest life insurance rates on the market.
This is why it’s often in your best interest to shop around, even if one company denies your application.
These are some of the most common reasons life insurance applications are rejected.
1. Physical health or pre-existing health condition
If you’re suffering from a chronic illness at the time you apply, the insurer may decline your application. Your chances of acceptance increase if you can show that your illness is being managed through consistent treatment.
2. Age
The older you are, the more expensive it is to get insured. Although there are many life insurance options for seniors, as you age, the policies available may not meet all of your coverage needs or may be very costly.
Your options for getting life insurance start to become limited once you reach age 80, but there are insurers that will offer you coverage through age 85.
3. Occupation
In rare cases, your occupation can impact your ability to get life insurance coverage, especially if your job is considered high-risk.
Because some jobs are more dangerous than others, if you fall on the riskier end of the scale your occupation may affect your life insurance rates. Some of these more dangerous professions can include:
4. Financial reasons
Getting a life insurance policy is a financial decision, and the insurer will want to verify that the policy you’re applying for makes sense with your financial situation.
For example, most companies will let you apply for an amount of life insurance coverage that matches about 30 times your income, and they could ask you to verify your income, especially if you have any nontraditional income — like freelancing or owning rental properties.
If you have a poor credit history, previous bankruptcies, or significant personal debt, these could also be concerning for the insurance company. The insurer wants to be confident that you can afford your premium payments and make sure that you’re not committing life insurance fraud.
5. Lifestyle choices
Smoking, skydiving, or a speeding ticket on your driving record won’t usually lead to a rejection, but you could get approved at a more expensive rate.
Make sure you tell your life insurance agent if you participate in any hazardous activities.
Skydiving
Rock climbing
International travel
6. Criminal & driving records
If you have a criminal record or poor driving history, this could hurt your options for getting life insurance coverage. For criminal history, the recency and frequency of your violations, as well as the nature (violent or nonviolent) of your offenses could impact how the insurer views your application.
For example, if you have multiple speeding tickets, you could end up paying more for your insurance, but if you have several reckless driving charges, the insurer may deny your application because this could increase your mortality risk.
Knowing the different options offered by some of the best life insurance companies will help you get a better sense of what insurers may be a good fit for your specific situation.
7. Lying or withholding information
If you intentionally leave out anything the insurance company needs to know on your application or during the phone interview, the insurance company can reject your application outright or increase your premiums later.
The insurance company will verify the information you provide on your application. In rare cases where the insurer misses relevant information that you should have provided, the insurer may not have to pay the death benefit after you die.
It’s always in your best interest to be honest and forthcoming when you apply for life insurance.
What to do if your life insurance application is declined?
Remember, just because one insurance company declines your application, it doesn’t mean you're uninsurable. If you were not approved, connecting with an insurance agent is the best way to figure out what other options are available to you for coverage.
Talk to an agent
An independent life insurance agent or broker can help you understand why your application was rejected. They can work with you to create a plan that will increase your chances of approval — suggesting, for example, to make healthy lifestyle changes or apply with a different insurer.
At Policygenius, our experts are licensed in all 50 states and can walk you through the entire life insurance buying process while offering transparent, unbiased advice.
Make some lifestyle changes
Sometimes, insurance companies will postpone your application to another date, usually six months to a year later. In that time you can improve your health, quit smoking, or take other steps necessary to get approved.
If your application is postponed, the insurance company will tell you exactly what they need in order to approve you in the future. They’ll be looking for a concrete example of change, like an improved credit score or stabilized medical prescription.
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Explore alternative life insurance products
If a life insurance company deems you to be high-risk, you may not be eligible for term life insurance, which is the most conventional type of policy. However, you may still be able to get coverage through other types of insurance.
Final expense life insurance is a type of policy aimed at covering end-of-life expenses, like a funeral, that offers lower death benefit payouts, although at a higher price point.
Guaranteed issue life insurance is a type of final expense insurance. It is best for people whose health may make them ineligible for traditional life insurance. While guaranteed issue policies are more expensive than other types of life insurance, everyone who applies is guaranteed approval.
AD&D insurance is a type of insurance that only pays out if you die or are injured in a qualifying accident. While AD&D insurance doesn’t typically provide the coverage that most people need, it can be a good option if you have trouble qualifying for more traditional life insurance.
Group life insurance is available for most full-time workers through their employer. It usually doesn’t require a medical exam, so it’s an especially desirable option for people with medical issues. While group life insurance usually isn’t enough to meet all of your insurance needs, it can be a great way to get at least some coverage in place.
Frequently asked questions
Why would a life insurance application be denied?
A life insurance application will be denied if the insurance carrier doesn’t think insuring your life is a good risk. The insurer may not be able to offer you coverage if you have high-risk medical conditions or practice dangerous hobbies. You may also be ineligible for certain policies due to advanced age.
How long do you have to wait to reapply for life insurance?
It depends on the reason you were denied and the insurance company. If your application was denied due to complications related to smoking, for example, you may have to wait six months or more and show lifestyle changes to the insurer.
What can make you ineligible for life insurance?
Certain types of life insurance policies, such as term life, are better suited for younger, healthier individuals. However, hardly anyone is completely uninsurable. Final expense life insurance options, such as guaranteed issue and simplified issue life insurance, are available to almost everyone.
