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Life Insurance Application Process: What To Expect

Shortcut: No obligation instant life insurance quotes will be displayed immediately by filling out the form on the left or above (mobile) this article. To learn more about the life insurance application process, please continue reading below.

This REALLY doesn’t have to be so scary and overwhelming. I promise you.

Knowing what to expect can often calm people’s fears. Stick with me for a few minutes and you’ll have a firm grasp on the life insurance application process, start to finish.

Questions that will be answered:

  • How long does it take?
  • What do I do next?
  • What tips do I need to know for each step?

Outline: 8 Steps of a Life Insurance Application

  1. Quotes
  2. Policy selection
  3. Application
  4. Medical Exam – (Prefer NOT to take a medical exam?) find out if it’s the right choice for you.
  5. Phone interview
  6. Waiting During Underwriting
  7. Decision
  8. Policy in Force

Step 1 – Get Quotes

As of 2014, there were 830 different insurance companies.

Do you need to get quotes from all of them to get the best deal? NO

Only consider insurers rated A- or higher by A.M Best, a respected rating agency. You want to know the company is going to be around and can pay out its claims.

Tip: our quote comparison tool only displays companies rated A- or better

Take a look at some of the quotes to get a feel for the price. A big factor in your rates will be your health classification. If you are unsure which rating you fall under (or don’t want to bother figuring it out), reach out to a trusted independent insurance professional for help.

If you are in good health, the quote engine will be accurate. HOWEVER, if you have any health concerns, it’s best to work with an independent agent that knows the industry. We don’t cost a penny and all insurance rates are fixed by law. There is nothing to lose and everything to gain in saving you the most money.

Estimated time for this step:

yellow wall clock, several minutes before 12Fastest: 1 minute using the quote comparison tool

Slowest: 2.5 months at 40 hrs/week talking to all 830 companies (don’t do it!)


 Step 2 – Policy Selection

The 2 main things you will need to decide in this step are:

  1. Term length – typically 5-30 years in duration. How long do you want the coverage for?
  2. Coverage amount – How much of a benefit amount do you want your beneficiaries to receive in the event of your death. Not sure? Check out our article on determining how much life insurance you need.

Before making your final selection, make sure you are applying at the right company for your situation. I cannot stress enough how important this.

For example: 

Jim has determined he needs $500,000 of coverage. Jim believes himself to be in the Standard health class and is getting ready to apply at Company X who has the lowest rate he could find. Jim did shop around, good job Jim.

However, what Jim didn’t realize is that his blood pressure is a little too high to qualify for the Standard rate class at Company X. He also is a semi-regular rock climber which will affect his rates.

Taking those factors into account, Jim should NOT be applying with Company X that showed him the cheapest rates. He needs to be with company Z who will let him slide a bit on blood pressure, provided his weight is very healthy (it is). This company also only adds a small extra cost to account for his frequency of rock climbing.

Had Jim consulted with an independent insurance professional, he would have known where to apply to get the lowest premium for his situation.

Estimated time for this step:

yellow wall clock, several minutes before 12Fastest: 5 minutes if you are in excellent health and already know what you want in a policy.

Slowest: 1-3 days to discuss with an independent broker and have them present you options based on their findings and knowledge.


Step 3 – Application

These days the majority of carriers allow for applications to be submitted online. If you need any help with the application, your independent insurance professional can assist you. This is their area of expertise, make use of it! Especially when you aren’t paying for this help.

Things to be prepared with beforehand:

  • Your social security and drivers license numbers
  • Income from latest tax return
  • Beneficiary information (who would get the money if you die?) including their social security numbers
  • Contingent beneficiary information – in case something happens to you and the primary beneficiary at same time
  • Your primary doctor’s contact information

Expect questions about:

  • Health history
  • Medications you take
  • Family’s health history
  • Criminal record
  • Driving record (any DUI?)
  • Any dangerous hobbies you participate in

Tip: Don’t lie. It’s fraud and they’ll most likely find out anyway. This is their business and they are very good at what they do.

Estimated time for this step:

yellow wall clock, several minutes before 12Fastest: 8 minutes

Slowest: 30 minutes


Step 4 – Medical Exam

Afraid of needles? Too busy to schedule an exam? You can consider a no medical exam policy but just expect to pay more. Typically 10-50% more.

The medical exam will be scheduled within a couple days of submitting your application. For many people, this is a scary step but let’s clear up some misconceptions so you know exactly what to expect.

Do I have to pay for the exam?

No.

Will I have to take another exam if I am not approved with the first company?

If you are working with an independent broker we can make your exam carry over to other insurers. If the initial decision is unfavorable and too costly, we will shop you to another company to get a better rate. If you are applying directly with the insurers, YES, you may need to submit to a new exam each time.

How long does the exam take?

About 30 minutes

Do I have to go into a doctors office?

No. A registered nurse will meet you in the comfort of your own home or office.

What will they do at the exam?

The nurse will take a blood sample, urine sample, check blood pressure, and measure your height/weight. They will also ask a few questions.

Tip: Find out how you can ace the medical exam to get a lower rate.

I’m busy, can I do the appointment on a weekend?

Yes.

In summary, the medical exam is not something to worry about. It is designed to be convenient for you while getting the necessary information. It allows the insurance carrier to understand your health picture and offer you the correct rate.

Estimated time for this step:

yellow wall clock, several minutes before 12Fastest: 2 days

Slowest: 2 weeks – depending on your schedule and when you can do it


Step 5 – Phone Interview

This step is easy. All you need to do is answer is truthfully and don’t volunteer information they don’t ask about.

The questions will be about your lifestyle, health history, family health history, and activities you participate in. They are trying to determine if anything that exists that should make them move your rating (and how much you will pay) up or down.

Estimated time for this step:

yellow wall clock, several minutes before 12Fastest: 12 minutes

Slowest: 30 minutes


Step 6 -Waiting During Underwriting

Now you wait.

During the underwriting process, the insurer is investigating and verifying the information you provided on your application and during the interview. They are also reviewing the results of the medical exam.

With that information, they will use hundreds of tables, formulas, and data to answer the question:

How likely are you to die during the term of this insurance?

from this, your premium will be determined. Underwriting timelines can vary depending on the company and the caseload of the individual underwriter your case is assigned to.

The big thing that can add a significant time is when they have to request your medical records from the doctor(s). This will be up to the underwriter so no way to know ahead of time. When this happens, it can add a few weeks time on average to the process.

While the doctors are required by law to fulfill the request in a reasonable amount of time, there is nothing that says they have to drop everything and do it the same day.

Estimated time for this step:

yellow wall clock, several minutes before 12Fastest: 1 week – if no medical records are requested

Slowest: 2 months


Step 7 – Decision

Hooray! you have an answer.

When you apply for insurance, it’s just that, an application. There is no guarantee of approval and the rate you thought you’d be paying could end up being different. If you have worked with a good independent broker, you should have been placed with the right company the first time and surprise responses should be few and far between.

When the decision comes back, it is an official offer of coverage. You will either be offered at the rate you applied or get “other than applied

This means you were approved (yeah!) but at a rate different than you applied for. It could be better but is usually worse. There are a number of reasons the decision could come back worse (other than applied).

  • You shouldn’t have applied at the particular rate class you choose. Working with an independent broker beforehand would have likely saved this.
  • The results of your medical exam bumped you into a lower health class than expected.
  • You neglected to divulge important information that was discovered during the underwriting process. This information had a negative effect on your perceived risk.

If you did get approved at the rate you applied, great, skip down to the final step.

If you received an “other than applied” don’t worry, you still have options and don’t have to just accept the higher rate.

2 routes to go from here:

Shop yourself to a different carrier – Every insurance company is different in how they assess certain risks. Maybe you were rated up because your blood pressure was a little too high and just missed the cutoff for that health class. Moving to a company that is more lenient on blood pressure could get you approved for the better health class.

Don’t just guess on which company to apply with now. If you were not already, (shame on you since it’s free) work with an independent broker. They know all the company guidelines and can tell you where the approval with higher blood pressure is most likely.

Modify the policy you are requesting – If the reason for being “rated up” is something likely to be an issue with other insurers, you’ll want to consider staying put and making a change to the coverage you were requesting. You can lower the coverage amount or term (years) in order to remain in the same budget you were hoping for.

For example:

40-year-old male that applied at the Preferred health rate and requested $500,000 in coverage on 30-year term. The best rate available (as of this writing) is $66.05 per month.

He was approved but 1 class lower, at Standard Plus. The rate would be $87.26 per month. If this makes the cost out of his budget, he could make these modifications:

  • Drop the term from 30 to 25 years
  • Drop the coverage from $500,000 to $400,000

This would bring his monthly premium down to $65.05, basically, the same as he had applied for (a dollar cheaper actually)

Some coverage is always better than no coverage. Just because you can’t get everything you wanted for the exact price you wanted, don’t let that be a reason to put off taking care of something you know you need.

Estimated time for this step:

yellow wall clock, several minutes before 12Fastest: a few minutes to read the decision

Slowest: a few more minutes if you read slower?


Step 8 – Policy in Force

Great job, you are just about done.

You now have an approval for a policy with a rate and terms you are happy with BUT….you aren’t quite covered just yet. There are a few things remaining to make the coverage active, known as the policy being “in force”.

If you worked with a broker, they’ll likely be the ones delivering the good news to you. Once you have reviewed and are happy, let them know you are ready to move forward and accept the insurance carriers offer/policy. Your independent broker will deal with the insurer on your behalf.

A few days later, your policy will arrive in the mail or online. After signing the applicable documents, you are SO CLOSE to being done.

In order for the policy to be in force, you must make your first premium payment. Most insurers have options for monthly and annual payments and also options in between such as quarterly. If your budget allows, you can save some extra money by paying annually.

life insurance application process - Family jumping together on the roadYour policy is now live and in force. Hopefully, you’ll never need it, but you can rest easy knowing that your family is protected if something does happen.

Tip: Use a conditional binding receipt to put the policy in force right away. 

To bind the policy, you will need to make your first premium payment at the time of application. This puts the policy in force right away assuming you are approved. If you die during the underwriting period, the insurance carrier will still pay the death benefit provided you end up being approved anyways.

Estimated time for this step:

yellow wall clock, several minutes before 12Fastest: 1 day

Slowest: 1 week – although could go longer if you don’t make the first payment right away.

Total time for life insurance application process:

yellow wall clock, several minutes before 12Fastest: 2 weeks – if you act fast at every step and no medical records need to be ordered.

Slowest: 3 months


What if I change my mind after the policy is in force?

Your are protected, don’t worry.

Life insurance policies have at least a 10 day “free look” period. Depending on the insurer and state you reside, it may be as long as 30 days.

What this means is that you have an additional 10-30 days to review the policy, ask questions, and cancel it without any penalty. Any premiums paid during this time will be returned to you in full.

Bottom line: You will have PLENTY of time to “think about it” while waiting during the underwriting period. Then even more time afterward with the free look period.

The life insurance application process doesn’t have to be so scary. Now you know what to expect and “knowing is half the battle” as G.I. Joe would say.Cartoon picture of G.I. Joe with children telling them "knowing is half the battle"

Please let us know if you have any questions about this process.

Life insurance is our ONLY business and we are obsessed with it. Yes, that’s sounds silly but take advantage of our knowledge and experience.

There is NEVER any cost or pressure when working with Simple Life Insure.

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About Ty Stewart

Ty Stewart is the founder of SimpleLifeInsure. He is an independent life insurance agent that works for his clients nationwide to secure affordable coverage while making the process simple. There is never any cost to use his services.

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