In our previous article, we gave an example of how charity signposting works. A young father with a lifelong heart condition tried for over two years to find an insurer willing to offer him Life Cover. Then a UK heart charity providing him with a list of brokers who specialise in assisting people with health conditions to find suitable insurance.
Likewise, a growing number of financial advisors now signpost to us when they have clients whose health condition is deemed to be higher risk, and the firm struggles to find an insurer willing to offer Life Cover to those clients.
Heart conditions and circulatory conditions are among the most common health conditions we see in the clients referred to us by financial advisors.
There are currently around 7 million people living with heart and circulatory diseases in the UK – that’s over 10 percent of the population. An ageing and growing population and improved survival rates from heart and circulatory events (such as heart attack) could see this number increase in years to come. From conversations we have with clients, we know that many people wrongly assume that their heart condition automatically means they aren’t eligible to get any Life Insurance.
Around 80 percent of people with heart and circulatory diseases have at least one other health condition, which makes it even harder for these people to find an insurer willing to offer them Life Insurance, even with the help of their financial advisor.
Financial advisors don’t want to tell their clients they are uninsurable. This is why a growing number of financial advisor firms have an arrangement with specialist brokers like Moneysworth to handle their declined Life Insurance cases.
They care about their clients and realise they have a duty of care to help them find the insurance they need, even if that means referring the client to a specialist broker. This duty of care is the key reason why financial advisors should have contingency plans for signposting their clients to a specialist.
The financial advisors who come to us rely on our specialist expertise. Our careful research not only helps to ensure their client has the best chance of being offered cover, but quite often results in that cover being offered at a surprisingly affordable price.
Most important of all, our comprehensive approach also means the client can feel that the insurance cover they’ve purchased is fit for purpose so that – if the worst happens – the policy will pay out.
A financial advisor firm recently approached us having tried, unsuccessfully, to find Life Cover for their client who has a heart condition.
The client is a male in his early forties who was diagnosed with Cardiomyopathy over ten years ago. Cardiomyopathy is a disease of the heart muscle which affects its size, shape and structure.
At this time, he was also fitted with an ICD (Implantable Cardioverter Defibrillator) – a life-saving device which is surgically implanted inside a patient’s chest if their cardiologist believes there is a real risk that the heart could suddenly stop beating. An ICD is a defibrillator that automatically detects if the heart stops and immediately shocks the heart to start it beating again.
The client has annual medical reviews and, despite the seriousness of his heart condition, he has no symptoms whatsoever.
We were not surprised that the client and his financial advisor had experienced difficulty in finding an insurer willing to offer cover. We knew that the majority of Life Insurance companies will decline an application where an ICD had been fitted – especially given the underlying heart condition diagnosed at such a relatively young age.
When we completed our research for this case, virtually all insurers in the marketplace confirmed they would decline an application for Life Insurance. But because we were thorough, we found two insurance companies willing to give further consideration to an application, subject to seeing a GP report.
With the client’s permission, these two insurers obtained a GP report including a letter from the cardiologist.
One of these insurers then declined the application, but the other offered mortgage term assurance with no exclusions and for the full sum the client needed (over £200,000) for the whole term of the mortgage (over 20 years) for less than £100 per month.
A satisfying result for us, for the financial advisor and for their client!
1. Figures obtained from British Heart Foundation’s “Heart Statistics” publication, 2018: https://www.bhf.org.uk/what-we-do/our-research/heart-statistics
Here at Moneysworth, we’re big fans of signposting. What do we mean by that?
For an insurance provider, it’s about considering consumers’ needs – even if that insurer cannot accommodate the special needs that an increasing number of consumers have.
For example, what happens when a consumer is shopping around for life insurance and they are refused cover because they have a health condition which makes them a higher risk for insurance? This can, often incorrectly, cause consumers to think that they’re uninsurable and to give up looking for cover.
Consumers with health conditions rely on charities for information and guidance to help them overcome the complexities they face, including the difficulties of searching for suitable insurance cover.
The British Heart Foundation (BHF) is the UK’s leading charity for funding research into heart and circulatory diseases and their risk factors. For several years, Moneysworth and other specialist brokers have been listed  on the BHF’s website or in its guidance publications. We don’t always know how people find us, but we do know from our conversations with clients that many people come to us after contacting the British Heart Foundation. This is signposting in action!
The review shown at the top of this article was written by a male client in his late twenties who was determined to protect his family’s financial future.
The problem was that, because of his heart condition, he couldn’t find an insurer who would offer him Life Cover. Soon after being born, he’d been diagnosed with a bicuspid aortic valve and coarctation of the aorta. When he was a teenager, he had open heart surgery, followed by a week in hospital and six months recuperation before returning to school.
Ever since then, he’s had annual checks at a hospital, but has no symptoms and doesn’t even need to take medication. He has no other health issues and no family history of heart defects or heart disease. He is able to work in a physical role and has an active lifestyle. Indeed, the reason he has a mortgage is because he has a steady job and income!
Yet every insurer he contacted declined to offer him Life Cover because of his medical history of having a rare heart condition.
After years of unsuccessfully searching for an insurer who would offer him suitable cover, he was signposted to Moneysworth via the British Heart Foundation.
With our specialist knowledge of the insurance market, combined with our medical knowledge, we were able to help the client find the cover he needed to protect his family’s financial future. He successfully applied for and started a Decreasing Life Insurance policy for almost £400,000 to cover a repayment mortgage over 35 years, for just under £50 per month.
Thanks to the British Heart Foundation making the effort to provide appropriate guidance and signposting, many people with heart conditions are able to find Life Cover after they’ve been declined by mainstream insurers.
I have been trying to get my ahead around some statistics that I came across yesterday.
Sainsbury’s commissioned the research looking at how many people in the UK had mortgages with no life cover in place to repay the outstanding balance. The results show some surprisingly big numbers, much bigger than most would perhaps guess.
Firstly the total figure of mortgages without life cover is given at £245,000,000,000 – thats a quarter of a trillion. But ‘billions’ and ‘trillions’ are everyday newspeak terms now, over used by both politicians and news reporters these words have become a sort of TV litter which we therefore tend to ignore as part of the familiar landscape.
Dig a bit deeper into the Sainsbury report figures though and we start to find more meaningful statistics.
The number of people with no life insurance to cover their mortgages? Just under 7 Million, or to put in a more meaningful way that equals just over 4 in every 10 mortgages. The report goes on to break down this figure between different age bands, as follows
Age Percentage of mortgage holders unprotected
Of course within these figures there will be mortgage holders who have valid reasons for not having life cover. The biggest such group will be single people with no dependants – fair enough. Another group might those with significant personal wealth.
But what about all the others? What about the significant majority who are not particularly wealthy but who do have dependent partners and/or families? What about the growing number of older people who find themselves with mortgages much later in life than they had originally anticipated? What are the reasons why these mortgage holders choose to have no life cover?
Here are some of the common reasons people give when asked.
”I’ve never really thought about it.” –
”Its a waste of money – its (my death) will probably never happen ”
”Its too expensive – I can’t afford it”
”No one will insure me with my health conditions”
But for the moment I should mention one other factor which I suspect lurks in the background for many and that is fear. Fear is a great inhibitor in all aspects of life. Fear changes our behaviour, it makes us more cautious, it makes us avoid action, fear makes us hide.
Generally people tend to fear the unknown. I am not a professional psychologist but based on my own observations fear is especially to do with a future outcome that is not known. Often the reason why people don’t face up to their fears is because they are scared as to what the outcome might be if they do. By avoiding action we feel like we are keeping the possible undesired future outcome at bay. Mostly its a subconcious kind of response.
So how does ‘fear’ apply to this issue of life cover for mortgages?
Perhaps underneath these figures many people are frightened about the questions they may be asked if they do apply for life cover. Perhaps they are frightened of having to reveal ’embarassing’ personal medical information about themselves.
Or perhaps they fear the final outcome – the fear that if they apply they they might get turned down and all that that might mean. For example it could confirm their own worst fears that they are going to die sooner rather than later, or in some way mark their financial credit record making it more difficult for them to borrow money in the future if they applied for a loan or mortgage. So some people might choose to avoid applying for life cover in order to avoid some sort of final judgement which they fear might finally mark their cards for good.
But of course fearing something does not mean that it is going to happen.
The problem is that many people are needlessly putting their families at risk by continuing to take no action. Put bluntly if you have no life cover for your mortgage on your family home then your home is at risk. If you have a family you owe it to your family to seek the appropriate life insurance in order to protect the family home for them.
Of course this for many will involve confronting a fear of the unknown.
But if only people with such fears knew where to look they might be quite surprised at the outcome. Here at www.moneysworth.co.uk we offer a specialist service for people with pre existing health conditions who are seeking life cover, for mortgages or for family protection (for other reasons too). Our service is confidential and non judgemental. We have over a number of years developed and refined a process which is designed to help customers find best outcomes. Each case is indivually researched. Further more our service is fee free to our customers and is with no obligation. Therefore it costs nothing to try.
The results are very encouraging. It should be said that we are not able to offer all customers a 100% guarantee that we will be able to find the life cover that they seek but we are able to help the majority, many of whom have been turned down elsewhere before coming to us. Very often the premiums acheived are considerably less than the customer originally feared.
Customers frequently express a high level of satisfaction with our service and often say that a great weight has been lifted for them. With the peace of mind knowing that their dependants are now protected they no longer need to live in fear.