When A Client Has Elevated Cholesterol
People typically dont think they have high blood cholesterol, says Heather Prado, underwriting specialist at the Milner Group, Atlanta.
Unless a person is closely followed by a medical practitioner, is older or has a risk factor for high cholesterol, says Prado, the person is likely to say, “Oh, my cholesterol is fine.”
But life insurance agents, brokers and underwriters say that isnt always so. Many applicants for life insurance do have elevated cholesterol but dont know it, they say.
That is forcing advisors to learn more about the condition–and what they should do if an applicants level is elevated. This article addresses those issues.
Cholesterol is a fat-like substance in the blood that builds up in the walls of the arteries. This buildup narrows the arteries and can constrict blood flow, according to the cholesterol section of the National Institutes of Health (NIH) Web site. High blood cholesterol is one of the major risk factors for heart disease, NIH adds.
Estimates are that as many as 102.3 million American adults have total blood cholesterol of 200 mg/dL (milligrams per deciliter) and up, according to the American Heart Association Web site. Medically speaking, a cholesterol reading of 200 is considered the maximum for the desirable range (see table).
Most people who apply for life insurance do have levels in the normal range, says Alta Garcia, an impaired risk specialist and operations manager at Brown & Brown Associates, Corpus Christi, Texas.
“Still, we are seeing more applicants who have elevated cholesterol that is being controlled by medication or diet and exercise,” she says.
This increase likely reflects the fact that more and more Americans are overweight, surmises Cindy Gentry, president of Brown & Brown Associates and chair-elect of National Association of Independent Life Brokerage Agencies, Fairfax, Va.
Knowing ones cholesterol level is not only a personal health concern for individuals, their families and health care providers, say insurance professionals, it is also a business concern for insurance underwriters and producers.
Thats because cholesterol level is one factor insurers use in assessing the risk they assume in issuing coverage.
Many insurers use the 200 level as their underwriting benchmark, but some use a slightly higher or lower level. (As discussed below, most also incorporate other factors when reviewing an applicant with an elevated level.)
Typically, a level above 200 will not result in the application being denied or table-rated, says Neal Hasty, vice president and chief underwriter at AIG Life Brokerage in Dallas. But the degree of elevation does influence the rate classification a person is assigned–typically between standard and preferred plus.
That assignment impacts the premium charged for the coverage and therefore, how successful the advisor will be in placing the case. Hence, the question: What should the advisor do when an applicant has elevated cholesterol?
The best situation occurs when the client already knows the level and/or has had a recent blood test showing the number, says Gentry. If the level is high (or has been in the past), the agent can then write a cover letter detailing what the client is doing to control the level, she says.
This letter, which accompanies the application, should also point out other factors that would support the applicant receiving the best rate possible, Gentry says.
Diet and exercise is one way that people can bring down their cholesterol levels, notes Garcia. Some clients also take medications to control the level. If an applicant is following one of these regimens, the agent should detail that in the letter, she says.
From an underwriters viewpoint, those letters are “extremely helpful,” says AIGs Hasty. “Its good if you can include information about the family, lifestyle, financial situation and any other information that will help us understand where the client is coming from.”
The insurance applications do have an “agent report” section where advisors can enter this information, Hasty adds, but unfortunately, a lot of agents do not fill that in or attach a separate letter.
What if the client makes application without knowing anything about his or her cholesterol level?
Thats the most common cholesterol underwriting situation, says Matthew J. McAvoy, principal of Target Insurance Services, Overland Park, Kan.
“The agent submits the app, quoted at the best class preferred or preferred rate. The notation says the client exercises, eats well and works hard. But then the offer comes back at a higher rate because, say, the applicant has a 300 level instead of 200.”
“Most underwriters do give the reason or the rate offer,” points out Michele Coughlin, director of risk selection for Target Insurance Services. “They will say, rated standard, due to cholesterol or something along those lines.”
Some even send along the cholesterol number, she adds. They do this because they do not want to alarm people, says Coughlin, since just saying “there is an abnormality in the cholesterol” can upset people.
(Underwriters also typically cite “build,” or “liver enzyme” as reasons for a rate change, when applicable, she says. But if the reason is AIDS, cocaine use or other sensitive medical conditions, that is not disclosed, she stresses. “Thats privileged information.”)
In any case, when the agent receives notice of a rate change due to elevated cholesterol, the case is not lost, say experts.
First, the agent should contact the client and point out that this is an appropriate price, in view of the lab information, says McAvoy.
“Then, encourage the client to go to his or her doctor and find out why the cholesterol is up. You can tell the client that if the doctor prescribes a diet and exercise plan or medication, and if that plan is successful in lowering the level, we can go back and try to get the initial rating changed.”
Some insurers will not reconsider a person for preferred if he or she was first rated standard, Coughlin allows, “but some will do that, after a year.” Insurance brokerages keep tabs on which insurers do what, she adds, so “never assume the rate youre offered is the final best offer.”
Does that mean agents should advise the client not to take the first offer? Not necessarily, says McAvoy. It depends on the case, but he generally recommends taking the coverage thats offered. “Next, see if the client can get the condition corrected, and then go back to see if you can get a better rateeven from the same carrierlater on.”
Sometimes, though, it pays to wait a few weeks. “If I can get the cholesterol reading right away, I can pick a company where the client can fare better,” explains Coughlin. “If we have a good shot as saving the client x-amount of dollars, we might want to encourage the agent to go back to the client and try placing with the other company.”
Another possible avenue is to ask the underwriter for an “exception,” she says. “After all, not all underwriting decisions are written in stone.”
That is important to keep in mind, say insurance experts. For example, the cholesterol total number is one thing, but the HDL/LDL (high density lipoprotein to low density lipoprotein) ratio can be a mitigating factor, points out Prado. HDL is the so-called “good” cholesterol that helps keep the LDL (“bad”) cholesterol from building up in the arteries.
Some insurers give a credit if the person has a HDL/LDL ratio of 3.0 to 3.5, Prado explains. Generally, there is no credit for a ratio over 5.0, however.
If the HDL component is very high, however, the underwriter also will check to see if there is an “alcohol criticism” in the attending physician statement or an indication of heavy alcohol use in the liver tests, she says.
They also will check past medical history, and, if the person has been on cholesterol-lowering medications, they will check to see how compliant the person has been in using the medication. Weight, diet and exercise all are factored in, too.
Hasty confirms that underwriters look at all of those areas. Most of this information is put on a type of grid, so the underwriter can evaluate all the factors together, he says. “Remember, we are looking at other lab results, too, not just cholesterolSo, there is some play thereThere can be compensating relationships.”
Hasty says he has seen cases with sky-high cholesterol levels, between 1,000 and 2,000. Such cases are “easily rated and possibly declined.” But theyre very rare, he adds.
Agents can best help clients by providing full medical disclosure up front, including names of providers that treat the client, Hasty says.
Also, before the client ever goes into the paramed exam, encourage the client to fast the night before, says Gentry. Some carriers require fasting, but others dont, observes Garcia, “but we tell agents to recommend it as a matter of routine.” But dont try to give medical advice, she adds. Focus on telling the person how to prepare for the exam.
Other tips: Encourage the client to avoid alcohol for a couple of days before the exam and not to exercise vigorously before the exam either, says Coughlin. Both of these can skew results.
Finally, “manage client expectations,” says Prado. “Let clients know it is not all puppies and rainbows. Then, you wont have to catch the client by surprise on the back end.”
Reproduced from National Underwriter Life & Health/Financial Services Edition, October 31, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.