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Case Design (26)

You Have To Ask The Questions – Marijuana & Nondisclosure

“Oops, I did it again…” a song made popular by Britney Spears in 2000 has absolutely NOTHING to do with life insurance protection but focuses on committing the same mistakes over and over. As an advisor to clients seeking life insurance coverage, you HAVE TO ASK THE QUESTIONS – the required medical and non-medical questions over and over again. Failing to procure detailed information – such as marijuana and nondisclosure – limits AgencyONE’s ability to advise accurately and puts your client’s coverage and your sale at RISK.

It Happened Again this Week

The client was NOT asked by his advisor if he uses marijuana. The advisor just ASSUMED that the client did not. While many carriers are NOT testing for THC (the psychoactive compound in marijuana) on insurance exams, they can and will at their discretion.

The case presented to AgencyONE involved a client that was DECLINED for coverage because he was unprepared for the life insurance exam. The decline occurred NOT BECAUSE the client was using marijuana recreationally, BUT BECAUSE HE DID NOT DISCLOSE IT. This carrier tested the urine for THC and the result was obviously positive. This was very bad news for the client AND the advisor.

For the record, recreational marijuana use, up to twice a week, can STILL be underwritten on a PREFERRED NON-SMOKER basis at a handful of carriers.

Insurance companies are combatting fraud every day. When an applicant is not forthcoming with habits, like marijuana use, it ignites suspicion and an underwriter naturally wonders what else is not being disclosed.

This is Not Just About Marijuana Nondisclosure

There’s more to focus on than JUST marijuana and nondisclosure: failing to disclose other pertinent information such as medical histories, doctors’ visits, medical tests, skin checks, colonoscopies, cigar or tobacco use, etc. can cause “hiccups” and significant delays in underwriting. If not admitted to up-front, these nondisclosures may lead to more questions, continued follow-up with clients to obtain additional information, and could potentially require additional medical records causing even further delays. Many times, nondisclosures are unintentional or simply an oversight by the client. Therefore, it is imperative that you thoroughly explain the underwriting process and impress upon your clients the importance of providing full details.

As professional insurance advisors, it is important from a LEGAL perspective that you ASK and thoroughly address ALL questions on insurance applications. If your client is completing a telephone interview or filling out a digital application, he/she needs to understand the importance of providing accurate, complete responses. This information becomes part of the LEGAL CONTRACT with the carrier. A nondisclosure is VERY LIKELY to be discovered by the carrier given the wealth of electronic tools and database information underwriters have at their disposal today such as:

  • Prescription Database Verification Reports
  • Medical Claims Information
  • MIB and Insurance Activity Index

AgencyONE Has the Tools to Help!

AgencyONE has created a library of tools to help you and your clients. Our email taglines now include 5 ICONS with hyperlinks that open various tools designed to assist with the entire underwriting process:

Exam Prep Video IconVideo: Preparing for the Life Insurance Exam

This video advises clients how to prepare for and what to expect during the insurance exam, including questions the examiner will ask…example: about marijuana and tobacco use!

Informal & Hipaa IconAgencyONE Informal Inquiry and HIPAA Packet

Complete this form to provide AgencyONE’s underwriters with the pertinent medical and non-medical information needed to advise on case direction.  The packet includes additional exam-prep tips and instructions on how to retrieve the insurance exam LAB results.

Interview Prep Video IconNEW* Video: Interview Prep

This video is perfect to advise your clients on whow to prepare for and what to expect during the Telephone or Digital Interviews. The corresponding worksheet can be found on our website www.agencyone.net under the underwriting tab.

Senior Prep Video IconVideo: Preparing for the Senior Supplement

This video explains what to expect during the senior supplement portion of the insurance exam.  While some of the questions and activities may seem trivial, the results can have a great impact on insurability.  The process MUST be taken seriously and preparing your clients is imperative.

Simply share the necessary linked icon(s) or the entire series with ALL your clients, and please visit our website for additional resources.

We urge you to make these AgencyONE tools an integral part of all your client preparations. You WILL notice a difference (in a positive way) on the underwriting process!

AgencyONE has the underwriting knowledge and necessary resources to help you present a thorough and well-planned case to the carrier best suited to your clients’ needs.

 

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