Wednesday, September 18, 2013




Life and health insurance companies want you to live a long, healthy life. But are their motives altogether altruistic? Insurance companies are in the business of maximizing profits, and it stands to reason that the healthier you are and the longer you live, the more money they make.
There are many measurable benefits to living a healthy life, for the individual, the family, and society at large. Reduced insurance rates are definitely one of the financial rewards those in good health can reap.



Ask a Pro
Russ Smart, MBA, is the owner of one of Canada’s first online insurance brokers. He’s been in the insurance business for 12 years and took the company “virtual” five years ago. He’s my family’s insurance guy.
“Do insurance companies consider a healthy lifestyle a plus when quoting insurance?” I asked him recently. “What about people who exercise regularly or take vitamins daily–is there any consideration for these healthier lifestyle practices?”
After a considered pause, Russ tells me there are three guaranteed ways to reduce life and health insurance rates.
“The first,” Russ says with a teasing tone in his voice, “is to choose your grandparents and parents well.”
Right. I try not to think too much about my own genetic inheritance. My parents departed this world on the train to glory in their early sixties. Heart failure, both of them.
I hear Russ saying, “The second way to reduce the cost of insurance is, don’t smoke.”
I figured he’d say both those things. That’s what they all say. “Okay, Russ, what’s the third?”
I wait for the answer. When he speaks again, his voice sounds more serious than before.
“Make the numbers work for you,” he finally says.
What’s he saying here? Win the lottery? Clean up at the blackjack table? “The numbers…?” My voice trails off, hoping to catch his drift.
“Yes, the numbers in what are called ‘measurable indicators,’ like blood pressure, cholesterol, and blood sugar levels.”
“Yeah, but what about all those people who take their vitamins religiously, never do drive-thrus, eat leafy greens and lentils, practise yoga, and walk five miles a day? Don’t they qualify for a discount?”
Even before I hear his chuckle, I realize if you’re really living the healthy life, your measurable indicators will confirm it.
“Think about it,” Russ says patiently. “Anyone can claim they’re taking nutritional supplements and exercising. Some people will fib about smoking. Even honest people who really are doing all those healthy things may change their habits for the worse. So insurance companies can’t base their rates on that kind of information. They have to have proof of a healthy lifestyle based on the numbers–the test results.”
Russ explains how insurance rates are calculated in more detail.
Be Healthy, Pay Less
Nearly all Canadian health and life insurance companies offer substantial savings to people without serious pre-existing health conditions whose measurable indicators are within the healthy range and whose parents did not die of an illness before the age of 60.
Using a kind of point system, insurance companies also factor in the applicant’s age, detailed personal health history and lifestyle, and family health history when calculating insurance premiums.
Obviously, there is nothing we can do to change our family’s health history, but there is much we can do to shape our own future health profile by improving our “measurable indicators.”
Underwriting Factors
Bringing and keeping cholesterol, blood pressure, and weight into healthy ranges and being a non-smoker are four major ways everyone can qualify for better rates. Other common considerations, called “underwriting factors” in the world of insurance, include asthma, alcohol consumption, and involvement in extreme sports.
Insurance companies assess an applicant’s combined underwriting factors to determine rates. For instance, normal adult blood pressure is generally identified as 130 over 85. Blood pressure levels at or slightly above 140 over 90 are regarded as low-grade hypertension. This factor alone will usually not raise your insurance costs but can if combined with other underwriting factors, such as high cholesterol or obesity. If your blood pressure is dangerously high, however, this factor alone may raise your rates. On the other hand, if you have successfully lowered your levels, your past higher numbers should not affect your most recent insurance costs.
Weighing in on Insurance Rates
To be considered for lower rates, don’t carry too much extra weight. Being more than 30 lb. (14 kg) over your ideal weight will probably make your rates higher. Your build or body mass index (BMI) is your height-to-weight ratio. If your BMI is too high, you’ll likely find your rates will be higher, too. Packing an extra 10 to 15 lb. (5 to 7 kg), if you have no other risk factors, is unlikely to cost you.
According to Statistics Canada, one in four Canadian adults (over five million people) is considered obese. Many of the associated health risks of obesity are underwriting factors for evaluating cost of health and life insurance, including type 2 diabetes, cardiovascular disease, high blood pressure, osteoarthritis, certain cancers, and gallbladder disease.
Before You Buy
Insurance companies offer discounts for healthier people by using “preferred” rates (better than average) and “preferred plus” (the very best rates available). Some Canadian companies also use a credit and debit system where positive lifestyle factors can overcome a negative hereditary or weight issue.
Underwriting factors can vary from one insurance company to another, so compare quotes and benefits before you buy. Insurance brokers are often your best connection to finding the plan and costs best suited to your needs.
Just about all insurance companies reward good health habits by offering lower, preferred rates, but they need medical evidence. If you’re exercising regularly, eating well, taking your supplements, and generally living a healthy life, your blood tests and other measurable indicators will prove it. And if the numbers aren’t adding up? Well, maybe it’s time to take a closer look at your approach to health.
Do You Qualify for the Best Rate?
While every insurance provider has its own unique criteria for assessment, if you can say no to the following, you may qualify for the best rates.
  • use of tobacco or nicotine products within the past four years
  • more than two moving violations within the past three years and no “driving under the influence” within the past five years
  • hazardous occupations or avocations or travel to hazardous areas
  • history of felony arrest or drug abuse
  • family member (natural parent or sibling) with a diagnosis of coronary artery disease, internal cancer, melanoma, stroke, or other life-threatening hereditary disease prior to the age of 60
  • history of other major health conditions
  • history of mental or nervous disorders
In Addition:
  • blood pressure (without medication) must not exceed 140/90
  • total cholesterol (without medication) must not exceed 220 and cholesterol/HDL ratio must not exceed 5.0
And You Must Be:
  •  a citizen or residing in Canada as a landed immigrant for at least one year
  • within height and weight limits (normal BMI range)
Source: insurancedirectcanada.com
Online Prevention Invention
Here’s how one Canadian employer–an insurance company–has taken steps to assess and improve the health and fitness of employees while improving the company’s fiscal health.
  • Employees voluntarily complete a confidential online Health Risk Assessment (HRA) questionnaire.
  • After assessing the individual employee’s health risks, lifestyle changes that can significantly improve health are identified.
  • Participating employees can meet with a health professional to interpret results and outline health-promoting goals.
  • Employer receives a combined summary of their employees’ (anonymous) health risks and an overall assessment of employee willingness to change.
  • Targeted wellness programs are designed for use within the organization.
Healthy Pay-Off
Progressive employers know that healthy employees make healthy companies. Here are a few of the results of this made-in-Canada health promotion program.
  • Four key employee health concerns were identified; stress, eating, exercise, and weight.
  • A lunch-hour walking team began as a way to improve fitness levels and reduce stress.
  • Weekly yoga classes were offered to help reduce stress.
  • Diabetes and weight loss support groups began meeting regularly.
  • Fitness club membership discounts for employees and family members were offered.
  • Follow-up clinical examinations to monitor progress and further reduce health risks were scheduled.
  • A company calendar of health and wellness activities was posted.
  • A corporate health team was established to promote organizational health, provide feedback on the effectiveness of health programs, and motivate employees to make a commitment to their health.


1 comment:

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