While we are seeing carriers liberalize underwriting for younger healthy applicants under $5M, the opposite is true for large cases, older insureds and those with ratable health conditions. For these cases, more carrier restrictions come through daily. We urge our agents to consider submitting formal applications as soon possible for any potential cases especially for:
- Clients over age 70
- Premiums over $1M - including 1035 amounts and premium deposit accounts
- Clients at potentially substandard rates
- Cases dependent on internal retention informal underwriting offers
Although submitting a formal application is not a guarantee that your client will avoid a Postpone due newly implemented COVID-19 restrictions, we know that some carriers have been honoring formal applications and approvals.
New Carrier Restrictions
- For individuals aged 70+, all cases will be postponed.
- For individuals aged 60-69, all rated cases inclusive of all medical flat extras will be postponed.
- For individuals aged 50-59, all cases assessed greater than Table B inclusive of all medical flat extras will be postponed.
- For individuals aged <50, all cases assessed greater than Table D and/or all medical flat extras will be postponed.
- Individuals with certain co-morbid conditions will also be postponed regardless of current risk assessment of their non-COVID impairments.
- Will not be making final underwriting offers on cases where the applicant is 80+
- Temporarily postponing acceptance of all applications for individuals aged 71 and older.
- Temporarily postponing acceptance of all applications for individuals of any age rated worse than a Table 4.
- Limit $1M on 1st year premiums and new funds into the premium deposit account.This limit will apply on all life insurance applications received on or after Tuesday, April 14, 2020. First-year premiums include paid-up addition deposits, lump sums, regular premiums and exchanges. The $1 million premium limit applies per owner or per payor.
- Postponing any applications on individuals with an insurance age of 70 and older.
- Postponing any applications on individuals of any age rated worse than a Table 4.
- Suspending acceptance of funds from external replacements in excess of $250,000 gross cash value.
- Suspending the following programs until we have clarity on the pandemic's impart:
- Table 4 to Standard Fold-In Program
- Survivorship Whole Life Rate Class Upgrade
- Lifestyle Credit Program
- A $1 million annual premium limit applies in all policy years. Premium includes all recurring premiums, 1035 Exchange values, lump sums, and multiple applications on the same insured. Individual consideration may be given for select cases over $1 million. Any application signed on or after April 13, 2020, must adhere to the premium limit.
- Insured ages up to 59 will have a maximum table rating of either Table 6 or a flat extra of $10.00/1000.
- Insured ages 60-80 will have a maximum table rating of either Table 2 or a flat extra of $5.00/1000.
- Ages 81+ will not be considered at any rate class until further notice.
- For survivorship cases, both lives need to meet the new guidelines. Additionally, risks with a combination of a table rating and flat extra will be postponed, and as a regular practice, we do not convert table ratings to flat extras nor flat extras to table ratings.
- Temporarily restricting new applications at age 80 and over - we will no longer accept any
application at age 80 and over until further notice, effective April 6, 2020.
- Postponing any applications at ages 65 and over with a rating class of Table D or higher.
- Postponing any rated case in which the client presents a chronic respiratory condition.
- Postponing any proposed insured who has tested positive for COVID‐19 for 30 days with full recovery.
This is not a comprehensive list of carriers changes but is intended to give you examples of recent carrier restriction announcements. As we are in unprecedented times and the carrier environment remains fluid, please contact us directly for the most current information.