Wednesday, May 22, 2013

Insurance Companies: Never Ask These Questions! (2)

What range of bone density levels are in your underwriting guidelines
to determine whether an applicant can receive preferred, standard,
rated, or no coverage at all?
Unfortunately, osteoporosis becomes a fact of life for many of us as we
grow older. Each insurer’s underwriters have their own guidelines for acceptable
bone density levels. It may pay you to shop around for a company
that doesn’t penalize you if your bone density is not ideal.

Will you pay for any expenses that are payable under my Medicare
Some forms of indemnity coverage will pay the full daily benefit regardless
of what Medicare pays for.

How many claims have you had under your temporary insurance
Temporary insurance receipts, sometimes called binders, can be unclear.
You need to know just what is covered and what your limits are.

How many different policy series has the company written since it began
writing long-term care insurance?
If your company introduces a new policy series, it may mean that the existing
policy is not properly priced. Long-term care insurers are reluctant
to raise premiums for fear of losing market share. Instead, they prefer to
eat their losses on the old series, but roll out a new contract and justify
higher premiums by adding enhancements and bells and whistles.

What is the ratio of your actual claims versus anticipated claims?
If the actual claim exceeds the anticipated claim, the insurer has several
options: increase the premiums, tighten underwriting, resist questionable
claims, and reduce service capabilities.

What percentage of your in-force business contains a nonforfeiture
A low percentage would indicate the cost is too expensive and the extra
premium would be better spent to increase existing benefits.

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