The Underwriting Toll Of Stress Burnout can be associated with medical problems of concern to underwriters
By Linda Koco
When a person gets burned out on a job, project or situation, thats not a major concern for personal insurance underwriters, say many observers.
The common thinking is, the person goes home, takes a few days off and presto, good as new. Theyre insurable.
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But not always, caution impaired risk experts. Burnout is a lay term for stress-related illness that can lead to or be associated with medical problems of nagging concern to insurance underwriters. These conditions range from weight gain and related diabetes to harmful weight loss, high blood pressure, depression or other emotional disturbance, broken sleep and many others.
Hence, insurance and financial advisors should take a second look when a client sighs and says, “Am I ever burned out.”
“We dont see burnout on the life insurance applications that come in here, but we do see a lot of people are taking Prozac and other mood elevating medications,” says Kevin Merz, president of The Merz Agency Inc., Portland Ore., and chairman-elect of the National Association of Independent Life Brokerage Agencies.
Since the recession in the early 2000s, “many employees work longer hours, lack suitable rest and exercise, and show signs of stress like smoking, overweight, emotional disorders and coronary artery disease,” agrees Samuel Marotta, underwriting advocate at the Herman Agency Inc., an Oak Brook, Ill., brokerage general agency.
“Most are insurable, and a standard rating is not out of the question,” he adds. “But the key is to determine to what degree the problems are impairing the applicants life expectancy.”
If a person has diabetes but is taking medication and has his or her diet under control, for example, that looks a lot better to a life underwriter than someone with the same condition but who is not following the physicians treatment plan, says Marotta.
In disability income insurance, “we see a lot of stress and job-related burnout,” agrees Larry Schneider, principal, Disability Insurance Resource Center, Albuquerque, N.M. “In fact, 30% of all DI claims submitted are related to this. Thats pretty high.”
This area is subjective, so some DI claims are denied when there is no basis found, he adds. Still, the trend shows that job stress is a problem, and its visible in DI applications, too.
If the client has situational stresssay, the persons mother diedbut the episode is brief and the person now has gone on with normal life, the stress may not be critical, Schneider says. “But job burnout is not usually situational, and it could go on for a prolonged period. In that case, its a red flag to the insurance company if the person puts in an application for DI insurance while experiencing this type of stress.”
Such stress can bring up difficult questions, he points out. For example, did the person have the auto accident because he/she started crying while driving the car or just because the road conditions suddenly worsened?