LIFESEARCH PRESS RELEASE
June 20th 2008
Trimming the fat from obesity insurance myths
Protection Specialists LifeSearch explains how a good IFA can help you beat the insurers’ increasingly harsh treatment of BMI and obesity.
As the England Rugby team prepare to face the All Blacks in New Zealand on June 14 and 21, it may come as a shock to learn that several of their mammoth super-fit players can technically be classified as obese.
Take Nick Easter for example. The England Captain is 6ft 4in and weighs in at a hefty 18st 2lbs. He’s one of the world’s top players, yet his BMI (Body Mass Index), the scale often used for measuring obesity, comes in at a whopping 30.9.
When it comes to life insurance BMI matters. If your BMI is too high, usually over 30, insurers may increase, or ‘load’, your premium, or they may even refuse you cover. If you have complicating problems, such as high blood pressure, it makes this outcome even more likely. There is no standard procedure for this and each company has their own processes for deciding who to load, and by how much.
This is where a good independent adviser can save you money. A good adviser will know which insurer will offer you the best premiums for your specific conditions. It is all very well going for the cheapest policy, but when the premium is hiked due to health issues, it is unlikely the consumer will know where to turn.
Although Nick Easter is not obese, his BMI level means that he is likely to be loaded by some insurers. Generally speaking a BMI of between 20-30 is fine - although there have been loadings as low as 27. A BMI of 30-37 could mean a 50% loading depend on insurer and over 37 could be declined. This is just a guide and the actual loading will depend on a client’s individual circumstances and on the insurance company.
The trick for those seeking to offer protection seriously must be to analyse the possible profit that can be made. Taking your gross, halving it and then deducting your costs would be my rule of thumb for the cautious.
Certainly the BMI level at which clients are being loaded has become harsher over the past 5-10 years. The old loading for obesity meant premiums jumped up by 20% - now it is 50% or more. People are being loaded earlier and loaded higher.
Remember, no single insurer will suit everyone. So those who have a high BMI or complicated health problems should ensure they do not simply go for the cheapest insurer, as it will almost certainly cost them more in the long run. If unsure, speak to an independent adviser. Peace of mind – unless you have to face the All Blacks!
