Diving Into Life Insurance

Life is filled with risks. Some of these risks end up becoming everyday occurrences such as crossing the street at a busy intersection. Certainly, a person could get hit by a car, but several safety factors have been put into place – marked crosswalks, crossing signals for pedestrians, red lights for cars – that help spare him/her from that fate. Then there are other risks, like skydiving or mountain climbing, which are less than everyday occurrences and are considered to be more than just a little dangerous. Often, people who undertake these more unpredictable risks are considered to be adrenaline junkies. Seeking a thrill is their identity, but at what cost?

How Does Skydiving Affect Life Insurance?

Adrenaline junkies understand how hard it can be to find a life insurance policy that meets the needs of their lifestyle and their budget. In a traditional life insurance policy, applicants are required to answer questions about high-risk activities such as skydiving. However answering “yes” to the high-risk activity questions does not necessarily mean that the application will be denied. There are a few different scenarios for adrenaline seekers looking for a traditional life insurance plan.

• Choose the preferred death benefit amount at a moderate premium, but include an exclusion that prevents any benefits from being paid out if the death is the result of a skydiving accident (or other indicated high-risk activity.)

• Choose the preferred death benefit amount, but do not exclude death from skydiving (or other high-risk activity.) The applicant must be prepared to pay a much higher premium because the insurance companies must protect themselves against this risk.

• Choose a lower death benefit amount, but do not exclude death from skydiving (or other high-risk activity.) Once again premiums will be quite high, so insurance companies can protect themselves against this risk.

What About a Simplified Issue Life Insurance Plan?

An adrenaline seeker may appreciate this type of insurance coverage. With a simplified issue life insurance plan there are no medical questions and very few, if any, questions about skydiving or other risky activities. The important qualifying factors for a simplified life insurance plan are the applicants age and gender. Typically, the one question asked is whether the applicant is a smoker or non-smoker. There are a few other things to consider before an applicant uses a simplified issue life insurance plan to insure his or her risky lifestyle.

• Although there are very few personal or medical questions to answer while applying of a simplified issue life insurance plan, applicants must remember that the premiums will be higher than for a traditional life insurance plan. This is because the insurance company has more risk to underwrite.

• In most simplified issue life insurance plans there is a waiting period before death benefits can be claimed. This time frame can be up to two years long, so if the applicant dies within the waiting period, the insurance company may spend some time investigating the death before paying the death benefit.

• Death benefit amounts may be limited in a simplified issue life insurance plan. This is not always the case, but an applicant should make sure that they can get the amount of death benefit they need.

In the past, avid skydiving enthusiasts had a hard time finding life insurance coverage that met their needs. Today, this is not the case. By working with a qualified life insurance agent even the biggest adrenaline junkies can find a way to provide for their loved ones after they are gone. To learn more about how we can help you get life insurance if you have a passion for skydiving, contact us at nomedicallifeinsurance.ca or call 1-866-899-4849 to talk with one of our life insurance professionals.

NoMedicalLifeInsurance.ca is an initiative of independent insurance expert Tamara Humphries and LSM Insurance.