Key to Success: Carrier Selection / Underwriting Exception
Applicant Summary:
- M, 41, NT, Super Healthy Executive, Rock / Mountain / Ice Climber
- Need: $7,500,000 of Level Term Business Life Insurance
Advisor calls CPS Advantage for a Second Underwriting Opinion on a new client who needs $7.5M term life insurance for buy-sell purposes. In his free time, he likes to climb some of the top peaks in the Rocky Mountains. The Advisor’s primary insurer requires standard rates plus a $2.00 flat extra per $1,000 of insurance to cover the risk. Are there better alternatives with another highly rated life insurer?
Advisor’s Primary Insurer
- Requires standard rates plus $2/$1K Flat Extra Premium
- Annual Premium: $24,254
- Insurer does not offer avocation exclusion riders
Top Rated Alternate Insurer
- Super Preferred pricing with avocation exclusion rider
- Annual Premium: $4,334
- Approximate premium reduction: $19,920/year ($398,400 total)
Note: All carriers required at least a Flat Extra of $2/$1K to cover the climbing risk. Some insurers in some states are able to offer avocation exclusion riders. By accepting such a policy, the policyowner self-insures for death resulting from the excluded activity, in this case, mountain climbing.
