Why life insurance for athletes is different?
Professional athletes have unique occupations; a cookie cutter approach to life insurance often doesn’t work.Certain sports carry a lot of risk, while others can be extremely hard on the body. Additional factors that can influence the life insurance rates you pay and/or if you qualify for life insurance include age, gender, smoking status, pre-existing conditions, and past or current drug use including performance drugs such as steroids or growth hormones. What is an uninsurable risk for one company may be an acceptable risk to another.
We specialize in life insurance for professional athletes. We work with Canada’s top life insurance carriers to ensure you get the best life insurance rates. It is important to mention that each life insurance carrier has their own underwriting protocols.
Our team of brokers helps design a customized insurance program. We will make sure you get the life insurance protection that you and your family deserve.
What Types of Life Insurance Can Athletes Get?
Many professional athletes are unable to qualify for traditional fully-underwritten policies as their sports may simply carry too much risk. Traditional life insurance policies can usually be divided into term and permanent policies. Term policies start off lower in cost but go up as you get older. Permanent insurance is initially higher in cost, but the rates are generally level for life.
So, what happens if you can’t qualify for traditional fully-underwritten life insurance? Your best option at that point is likely a no medical policy. The most common type is simplified issue life insurance. Simplified issue insurance plans have no medical tests, but there is a series of health and lifestyle questions.
The other type of no medical life insurance is guaranteed issue insurance. The big difference with these plans is, there are no medical questions to answer. As the name implies, your acceptance is guaranteed. The major drawback is that the full death benefit is not available until after the policy has been in force for a given amount of time, usually one to two years.
Working with an independent broker who specializes in insurance for athletes will ensure you get affordable rates. We offer no-pressure life insurance solutions and provide free no-obligation quotes.
What Are the Costs of Life Insurance for Athletes?
Professional athletes looking for life insurance are more likely to need a policy with a large face amount. The reason for this is the amount of life insurance needed is generally tied to your income. Your income is what supports your lifestyle; if that income were to stop, how would your family pay ongoing expenses?
Professional athletes can earn millions of dollars per year and it takes a lot of money (i.e. life insurance) to replace that income.
The cost of life insurance is influenced by many factors. The insured’s age, gender, smoking status, health status, type of plan, and the amount of coverage are just a few of those factors.
Life insurance rates can also be impacted by occupations that carry additional risk. Lifestyle issues, such as the consumption of performance enhancing drugs, also impact the insured’s health; and therefore, the life insurance premiums. Each carrier has its own underwriting protocol, so it’s crucial to work with an independent broker who has access to a wide variety of insurance companies. An independent broker can also make a preliminary inquiry. In this instance, the broker reaches out to an underwriter to determine if you are likely to qualify for life insurance. If it looks like there is going to be a heavy rating or there is a chance you may be declined, the broker may suggest a simplified issue policy. These policies have no medical tests and contain a short series of questions. The more questions you can answer “no” to, the better the rate you can expect.
Things to Pay Attention to When Choosing Life Insurance for Athletes
Professional athletes should be wary of exclusions in their life insurance policy. Engaging in risky occupations and/or participation in high-risk sports can also result in your life insurance policy having an exclusion.
A life insurance exclusion is a provision within your policy that prevents your beneficiaries from receiving your death benefit. Insurance companies can decide which exclusions to include in their policies.
Exclusions will be listed in the policy, so the insured will know which causes of death may not be covered ahead of time. However, if you are unsure, you should reach out to your insurance broker and/or the insurance company directly and make sure to get a response in writing.
The main reason why life insurance companies add exclusions to their policies is to protect them from risk. Exclusions are a way for the life insurer to reduce the likelihood of paying a death benefit in certain situations.
Two common life insurance exclusions include death caused by:
- Suicide: If the policyholder dies by suicide generally within two years of purchasing their policy, then a life insurance suicide exclusion likely applies, and the insured’s beneficiaries are not eligible for the death benefit.
- Acts of war: If a policyholder dies as a result of wartime activities, coverage may be denied.
Another common exclusion is service in the military. Since military service may make a policyholder a higher risk to insure, this exclusion may be present in policies.
How to Get Life Insurance if You Are an Athlete?
Professional athletes have several avenues they can explore when looking for life insurance:
- Work with an independent broker who is experienced working with professional athletes and the hard-to-insure market. An independent broker will have access to multiple carriers and can also make preliminary inquiries to see if you are better off with a fully underwritten life insurance policy or a no medical simplified issue life insurance policy.
- See if your employer and/or league offers some type of group life insurance. If your employer offers a life insurance plan as part of its workplace benefits, this may be an affordable option. Keep in mind that most group policies typically offer a base level of coverage (e.g., $300,000) so group plans are likely best viewed as supplemental coverage.
- Look into specialized life insurance companies. Some insurance carriers specialize in higher-risk applicants, so depending on your sport and/or lifestyle factors, a niche insurance company may be worth exploring.
