When dealing with an impaired risk case, many times the Big Three " coronary artery disease, diabetes, and cancer " are involved, either individually or in some combination.

Today, those advisors who are well prepared to serve their clients, particularly those who are older, should recognize the importance of having a basic understanding of impaired risk underwriting.

When meeting or speaking with clients, certain basic facts are helpful in making an initial appraisal of the case. Fact-finding is where it all begins, and that means not being afraid to ask questions about the clients medical history. Too often, producers can do a disservice to themselves and their clients by avoiding medical questions.

Honesty Pays

Producers should be able to explain the APS process (Attending Physician Statement). This is where the insurance company requests copies of the clients medical records and medical history from his or her doctor.

The APS includes all lab tests performed, along with the results and any other recommended tests. This also includes an explanation of signing the authorization and HIPAA forms so the insurance companies can gain access to the medical information. A complete file with accurate information allows the insurance company to make an informed decision about the clients health.

Some clients are reticent to disclose their medical history, believing that a lack of full disclosure will hide the facts from the insurance company. As we all know, this is not correct since insurance companies have access to the Medical Information Bureau (MIB). This contains information such as, for example, if a client has applied multiple times with various companies, and if he or she has been declined or highly rated by these companies.

It is the brokers job to encourage clients to be forthright and candid about their medical history. In fact, it is in a clients best interest to be open so that problems will be avoided in attempting to secure the coverage he or she wants and needs.

The Risks

If we break down the major impaired risks, it is clear that heart disease is the primary concern of underwriters. Cardiovascular disease is the number one killer of both women and men. The American Heart Association calls heart disease for women The Silent Epidemic.

Coronary Artery Disease

With CAD there are a number of key questions to ask a client:

Are they on medication? If so, what and how much?

Have they had a stress test? What are the results and date completed?

Has the client had a heart attack? When did it occur?

Has the client had by-pass surgery? What was the date of the procedure?

Has the client had Angioplasty? What was the date of the procedure?

Does the client know the Ejection Fraction? The Ejection Fraction or EF, measures blood-flow. The normal EF is 55 percent or greater. If it is 50 percent or less, this is an indication, to some degree, of dysfunction. The lower the percentage, the worse the prognosis. Thirty-five percent or less would probably be declined, or highly rated, by insurers. A low Ejection Fraction percentage would be a difficult risk to place, if it can be placed at all.

Diabetes

Diabetes is characterized by a high glucose (sugar) level. A clients diabetes control is monitored by testing Glycohemoglobin in the blood, also known as Hemoglobin AIC. It is helpful to have a sense of the range for the AIC numbers:

Normal level " 6.0 or less;

Acceptable level " 7.0 to 9.0;

Very poor control " 9.0 or greater.

Using this guide, producers will have an idea of the degree to which the client's diabetes is controlled. If a client is well controlled, this will work in his or her favor as far as underwriting is concerned. If it is not well controlled, this will cause concern for the underwriter and can be reflected in a rating (extra premium charge) for the client.

Besides the AIC number, these are other key factors producers should know about:

What medications are they on and what is the dosage?

Do they exercise regularly?

What is their diet like? Fast foods or lots of vegetables?

Cancer

Just because a client has cancer history does not always mean a decline or highly-rated situation. The key points to focus on when gathering information from clients are:

Tissue of origin;

Grade;

Stage;

Time since diagnosis;

Type of treatment;

Time since treatment ended;

Relapse or reoccurrence.

Two general terms, grade and stage, need to be reviewed when discussing cancer. This is key information for underwriting an impaired risk case with cancer.

Grade refers to the aggressiveness of the cancer. The higher the grade, the more rapid the growth of the cancer. Most cancers are graded one to five, with grade 1 seen as most favorable (a low grade malignancy).

Stage refers to the extent of the tumor/mass; the size and/or spread. Again this is graded from one to five, indicating how limited or invasive the cancer has been.

In gathering pertinent medical history information from a client, the advisors role is only obtaining factual data. It is not interpreting the meaning of the facts even if the client asks the advisors opinion.

Careful, thorough fact-finding can and will benefit the client and the client-advisor relationship by helping to avoid unnecessary issues that will certainly arise later in the process if they are not addressed up front. This is particularly true of the Big Three.

Denise Desautels, vice president of brokerage sales for First American Insurance Underwriters, Needham, Mass., has more than 20 years of brokerage experience. She is a member of the board of directors NAIFA-Boston (National Association of Insurance and Financial Advisors), and has served as the co-chairperson of its Annual Sales Congress and Public Service Committee. She is a past winner of the organizations National Public Service Award.