{"id":369,"date":"2018-10-24T09:22:44","date_gmt":"2018-10-24T16:22:44","guid":{"rendered":"https:\/\/mgfadvisory.ca\/news\/?p=369"},"modified":"2018-10-24T09:25:42","modified_gmt":"2018-10-24T16:25:42","slug":"underwriting-demystification-the-benefits-of-pre-underwriting","status":"publish","type":"post","link":"https:\/\/mgfadvisory.ca\/news\/2018\/10\/24\/underwriting-demystification-the-benefits-of-pre-underwriting\/","title":{"rendered":"Underwriting Demystification – The Benefits of Pre-Underwriting"},"content":{"rendered":"\t\t
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\n\t\t\t\t\t\t\t\t\t\t\t\t\t\"Underwriting\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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The Underwriting Process <\/span><\/b><\/h3>

There are several reasons why people want to use their life insurance more strategically. Some want to protect a dependent; others may owe money, personally or through their business, and want to use their life insurance as an asset (IFA). While these are good strategies, before you can move ahead with them, you have to go through the life insurance underwriting process. <\/span><\/p>

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Underwriting Uncovered <\/span><\/b><\/h3>

In essence, the underwriting process is an insurance company\u2019s opportunity to look at the insurance application and certain attributes of your financial and personal health in order to decide whether to ensure you and at what premium. <\/span><\/p>

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The Role of Your Insurance Broker <\/span><\/b><\/h3>

It\u2019s your broker\u2019s role to collect information for your application of insurance. This includes details of your income, lifestyle, personal and immediate family medical history, as well as anything you do that may be considered hazardous, like hang gliding, skydiving or lion taming (we highly dissuade you from the latter)! Additionally, depending on the size and scope of your insurance policy,\u00a0a visit from a paramedical professional may be required.<\/span><\/span><\/p>

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Medical and Financial Disclosure <\/span><\/b><\/h3>

Your broker\u2019s responsibility is to help collect this information: your responsibility is to speak in utmost good faith and truth about this information. If there is any intentional omission of key information, it can result in a breach of contract. However, as long as information is disclosed to your broker in good faith the contract is generally binding.<\/span><\/p>

While your broker will need to collect medical data, they will also be required to collect information about your income, net worth, and where it’s corporately held in order to show that the insurance makes sense financially. <\/span><\/p>

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In Good Faith <\/span><\/b><\/h3>

A broker will not to make up this information on your behalf or \u2018pretend\u2019 not to hear certain things. On the contrary, the broker\u2019s job is to account to the insurance company honestly, and it\u2019s your job to report in good faith so that the contract can be clearly enforced. It\u2019s important to understand that your broker is not an employee of the insurance company, but rather an intermediary. In this way, they are charged with collecting accurate and complete information. <\/span><\/p>

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An Ounce of Prevention <\/span><\/b><\/h3>

While pre-underwriting can seem like a bit of an inconvenience, generally the result is a policy that you can count on to do what it should. Foregoing the pre-underwriting process can result in postmortem problems, and result in significantly lowered payouts, which can, in turn, be unsettling for your beneficiaries. For this reason, pre-underwriting is by far the preferred method–it\u2019s worth a little inconvenience for the peace of mind! <\/span><\/p>

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The Benefits of Pre-Screening <\/span><\/b><\/h3>

A major benefit of medical pre-screening is your premium owing can be materially cheaper when compared to guaranteed issue insurance (no pre-screening). In this way, your insurance product can be counted on as it has been pre-screened and accepted, as opposed to guaranteed issue products that are underwritten after death and, therefore, potentially subject to denied payments. Moreover, there are cheaper premium options available for those who opt for the prescreening process.<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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\n\t\t\t\t\t\tLet MGF Advisory Help \t\t\t\t\t<\/h2>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t
\n\t\t\t\t\t\tMarco Faccone, CPA, CA, CFP has long specialized in the area of corporately held insurance and estate planning, advising and assisting shareholders with succession and wealth accumula-tion strategies. Marco has worked alongside estate lawyers and tax accountants to offer his cli-ents a professionally tailored and value-added plan. Contact MGF Advisory for more information regarding corporately held insurance and succession planning. \t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t
\n\t\t\t\t\t\n\t\t\t\t\t\tBook a Meeting\t\t\t\t\t<\/a>\n\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"The Underwriting Process There are several reasons why people want to use their life insurance more strategically. Some want to protect a dependent; others may owe money, personally or through their business, and want to use their life insurance as an asset (IFA). While these are good strategies, before you can move ahead with them,…

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