Some occupations come with a higher risk compared to others, but what does this mean when you want to take out life insurance to protect what matters the most? Will your occupation be flagged as a risk by insurers? Here is what you need to know.
What do insurers consider as a risk?
“The core of any insurance company is to sell you a promise that should anything go wrong with what they have insured you for they will payout. Risk is essentially something that could put you and the insurer in danger, which sees all sides losing,” says CEO of MiWayLife
Insurers usually determine high-risk occupations by assessing the overall risk of your job title, your individual duties and the hazards they involve and the overall hazard of the environment you work in. For example, someone who is a race car driver or has an occupation that requires that they take some form of substance to boost their performance may be seen as a risk by insurers.
“If you do something where you are fully aware they you could end up deliberately inflicting injury on yourself then it is highly likely that you will not be covered by a traditional insurer,” states Baker. Which occupations will raise red flags from insurers?
The top jobs that are seen as high risk by traditional life insurers are that of miners, firefighters, police or armed forces workers. This is due to the stressful environment that they find themselves in and the high risk of bodily harm that they place themselves in. However, such occupations already have specialised life insurance in place to protect their employees.
Mechanics could also be flagged as a risk due to the nature of their job. Not only do they have to go underneath heavy vehicles, but they also handle hazardous chemicals that are found in brake fluid and clutch parts. It is possible to get hospital plans and cover from their respective companies but approaching a traditional life insurer can make it hard for them to get cover. Pharmacists and emergency service practitioners will also receive a specialised cover from their relevant employers that protect them from any unforeseen events. There are other factors that insurers look at
Life insurers employ a team of underwriters to asses everyone, even if you do not work in the above mentioned occupations. The questions that are asked by underwriters are generally to asses if you are not a risk when it comes to your health and lifestyle.
Once the underwriters have gathered the information they need they will then calculate your level of risk, which will determine your premium, or whether you will receive any cover at all.
When taking out life cover your insurer will explain their exclusions or loadings
which will affect your life policy. Keep in mind that you can always ask your insurer to explain any terms that you do not understand before you put your name on the dotted line.