Approximately 46% of our members have faced an exclusion, a loading or a rejection of their insurance application. The policies most likely to be affected are income protection and / or TPD. The most common exclusions are around mental health conditions and sporting injuries.
We all know that our bodies are unlikely to stay as healthy as they are now, for our entire lives.
Injury and illness of some kind is probable. However, once you have your insurance policy in place, the insurance company must always honour it, even if you end up being the most injury prone and ill person in the world.
Getting cover early, whilst you’re young, can mean an opportunity to lock in a lifetime of protection. Before you throw some part of your body out of whack!
Whilst you may be a generally healthy person, if you have enough existing injuries, an insurance company has the right to reject your application for cover altogether. This is generally a three strikes rule. If you would be looking at three separate exclusions, you are deemed too risky to get cover.
Also important to consider for issues like knees and ankles. If you’ve got issues with both legs, that can count as TWO exclusions! That doesn’t leave you a lot of room to move!
As such, insurance companies are very conservative when considering offering cover to any of us who’ve had any form of mental health issue. If you have suffered from anything mental health related in the past (from mild cases such as stress or anxiety and visited a doctor or psychologist about this, to more extreme cases such as depression), you will very likely be faced with a blanket ‘mental health exclusion’. However, what’s equally concerning is that most companies would not even consider reviewing this exclusion for at least three (sometimes five) years after the event.
Your friends and families (and perhaps you in the past) might think that insurance is for old people. But the earlier you can get cover in place, the more likely it is to be affordable and comprehensive.
If you’d like to know more about your cover, or you know someone who needs it, get in touch!
You may be wondering what the difference is between an exclusion and a loading…
An exclusion is where the insurance company specifically identifies an area of your body or a type of event that they will not cover you for. The rest of your policy however may be at standard premium rates. Depending on the exclusion, you may be able to get it reviewed and removed after a certain number of years.
A loading is where the insurance company identifies that you are a higher risk applicant. Although they may cover you for all events (unless you also have an exclusion), they will apply a loading to your premium. This may be from 25% up to 100% of standard rates. This means that you can potentially have full cover (which is a great result) however it will be more expensive. Depending on why you’re given the loading, you may be able to get it reduced or removed over time.
Disclaimer: all information contained within this article is of a general nature. Do not rely upon it when making financial decisions. Please consult a professional financial advisor or planner (like us!) before acting.