How Do Life Insurance Companies Check Medical Background?

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

If you’re wondering about how life insurance companies check medical backgrounds, you may be surprised to learn that it’s not as simple as a doctor’s appointment. In order for an individual to qualify for coverage, the company will need to look at their entire health history and make a judgment call on whether they are eligible or not. It can take up to two weeks before coverage is approved, and during this time period, there will be no protection if something were to happen!

How Do Life Insurance Companies Check Medical Backgrounds?

  1. Order Medical Records:
    • Request a copy of your medical records directly from your doctor or hospital.
  2. Use a Third-Party Service:
    • Employ a specialized third-party service called, Medical Information Bureau, that collects medical information on your behalf. Applicants who are unable to obtain insurance due to information included in an MIB report must be given an explanation and the opportunity to dispute facts relating to their medical history that may be incorrect.
  3. Complete a Medical Questionnaire:
    • Fill out a medical questionnaire the life insurance company provides, detailing your health history. When only a tiny amount of insurance is required, the applicant and agent are typically permitted to finish the medical portion of the application. This is known as underwriting on a non-medical basis or a simplified issue.

What Are Life Insurance Companies Looking For?

When a life insurance company checks your medical background, they look for any red flags that may indicate that you are not in good health.

For example, they may look for a history of serious illnesses or injuries, hospitalizations, surgeries, or chronic conditions. They will also examine your family medical history to determine your risk for hereditary diseases. If the life insurance company finds anything that raises concerns, they may require you to get a medical exam before they sell you a policy.

Do Life Insurance Companies Share Information

What Is Required For Large Policies

  • Medical Exam and Testing:
    • Applicants, especially those seeking substantial insurance amounts, undergo medical examinations.
    • When mandated by insurance companies, examinations are conducted at the company’s expense.
  • Inspection Reports:
    • Underwriters request credit histories and review financial and moral information from independent examining firms or credit agencies.
    • General reports on finances, health, character, employment, and hobbies are typically produced.
    • For larger policies, detailed reports are generated, involving interviews with friends, coworkers, and family members.
  • Investigative Consumer Reports:
    • In-depth reports encompass information on a consumer’s character, reputation, personal habits, and lifestyle obtained through research and interviews with acquaintances.
    • These reports are only produced after the consumer is fully informed and provides written consent.
Do Life Insurance Companies Contact Your Doctor

HIPAA Disclosures

HIPAA requires that healthcare providers maintain patient privacy and safeguard patients’ sensitive health information. Providers must keep patient confidentiality in mind at all times. If this information is revealed by mistake, healthcare providers must take steps to minimize the damage to patients.

When insurers and producers deal with the protected health information of applicants and insureds, they are bound by strict regulations. All medical records are to be kept confidential while underwriting a person.

If the insurer wants to share this information with others, the applicant must be given full notice of the insurer’s policies regarding the treatment of this data, their rights to privacy, and an opportunity to opt-out.

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Frequently Asked Questions

Do life insurance companies check medical records?

Yes, life insurance companies often check medical records to assess an applicant’s health status and risk level. They require applicants to consent to access these records. The information helps determine eligibility, premiums, and coverage limits, ensuring the policy is priced appropriately based on the individual’s health and life expectancy.

What medical records do insurance companies have access to?

Insurance companies can access records like medical history, prescriptions, and diagnoses with the applicant’s consent. They review this data to assess the risk and determine eligibility and pricing for policies. Privacy laws dictate the extent and manner of access to ensure confidentiality and security of individuals’ health information.

How far back do insurance companies check medical records?

Insurance companies typically look back at the last 5-10 years of an applicant’s medical history, although this can vary. They assess past illnesses, treatments, and medications to determine the individual’s current health status and potential future risks, which informs the eligibility, coverage terms, and pricing of the policy.

What is the medical information bureau?

The Medical Information Bureau (MIB) is a non-profit database that collects and shares coded health information among member insurance companies to assess risk. It aids in underwriting by providing data on medical conditions, tests, and treatments, helping insurers evaluate applications for life, health, disability, and long-term care insurance efficiently.

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Shawn Plummer is a Chartered Retirement Planning Counselor, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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