Hobbies that may make your Life Insurer Squeamish

Things like smoking or having a high risk job will affect your life insurance policy – namely the premiums will be higher in relation to the risk you take. Most people, however, do not think of their hobbies when they take out a policy (or their policies when they take up a hobby). However some activities that you perform as a hobby in your spare time will make your insurance company very nervous. An obvious example;  having “skydiving” as a weekend hobby will affect your policy – It will cost you a lot more than someone who doesn’t go skydiving as you have a greater risk of being killed while enjoying this hobby.

Failure to inform your life insurance company of a potentially dangerous hobby could result in the company not paying out in the event of a death while partaking in that hobby, or as an effect of that hobby.

So what hobbies do life insurance companies consider high risk ?

  • Skydiving (as mentioned),
  • Bike, Boat, or motor vehicle racing,
  • Bungee Jumping (as a continuous hobby – not just a one off),
  • Hang Gliding, hot air ballooning, or any form of flying,
  • Parachuting,
  • Rock, or other forms of climbing (buildings, bridges, etc etc),
  • Scuba diving, or any form of deep diving,
  • Surfing, both normal and wind surfing,
  • Skiing, or snowboarding racing.

There are other hobbies not listed above, so you are advised to consult your insurance company when applying for life insurance if you have a hobby that is considered unusual, or involves anything that may be fatal.

Most people tend to tend to forget these activities when applying for a life insurance (Failure to do so could invalidate your policy, resulting in no payment in the event of a serious accident causing death), particularly in the case of hazardous activities. If you were a regular parachutist when you took your policy out at the age of 25, but stopped doing the activity a few years later, you should contact your insurance company and have the details of your policy reviewed (with parachuting being removed) – You may find your premiums drop considerably.

If your insurance company are uncomfortable with your hobby (either at the start of the policy) you can usually find specialist insurers who offer coverage for your hobby. Check with other people who do the same hobby, or with the club you attend to find the name of a suitable insurer. Obviously the premiums for these policies will be higher than regular policies.

The bottom line is, if you do anything that may put your life in danger, either at home or at your job, you should consult your broker to make sure you have sufficient coverage from your life insurance policy.

Life Insurance … What is the Underwriting Process?

Photo of Insurance Application Form

The Insurance Underwriting Process

The underwriting process generally takes about 4 to 6 weeks however if an attainting physicians report is required this could add several more weeks before obtaining a decision from the insurance carrier.

Life Insurance Underwriting is a process that determines the risk of insuring a person. Underwriting involves looking at the application and evidence provided to determine the risk the insurance carrier takes in insuring this individual. This calculation is translated into the cost of the policy, which means the more risky the individual is to insure, the more the policy will cost.

Factors an insurance underwriter use include a variety of things, such as the applicant’s age, general health, family medical history and any preexisting medical factors they may have. Also included are an individual’s choices such as if they smoke, or if they engage in risky activities such as sky-diving, bungee jumping or motor vehicle racing. If you are looking to purchase life insurance it is imperative that you understand the options that are available to you.

Buying life insurance can be a confusing undertaking without the guidance of an insurance specialist. With so many options and types of policies offered, it is no wonder people often feel weighed down. A life insurance broker works with you to make sure this is as simple and effortless as possible.

Speaking with a life insurance specialist with Solutions Financial is a step in the right direction.