If you are looking for life insurance, you may be surprised to discover what can affect your life insurance cost. Alcohol use can play a big role in what you end up paying for coverage, especially if you have a history of excessive alcohol use.
Excessive alcohol consumption can cause a number of health and behavioral problems that increase your insurance company’s risk of insuring you and result in you paying a higher life insurance cost for your policy.
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Underwriting alcohol for life insurance
When you apply for life insurance, insurers review the complete application and all records that go with it. They then decide how much cover and at what cost to offer the applicant, unless they decide to refuse or delay the application.
In the case of alcohol, the underwriter will use medical records (especially those related to treatment for substance abuse and psychiatric illness), social profile, motor vehicle reports, laboratory results and physical findings to assess the risk associated with excessive alcohol consumption. A blood test, Carbohydrate Deficiency Transfer (CDT), can sometimes be used in insurance to identify those who consume too much alcohol.
The following is a list of complications from excessive alcohol consumption that are significant to life insurance coverage:
- Cardiac: Atrial fibrillation, cardiomyopathy, hypertension
- Nervous system: Blackout, convulsions, delirium tremens (DTs), peripheral neuropathy, tremors, brain damage, psychosis, balance and gait disorders
- Gastrointestinal: Fatty liver, hepatitis, cirrhosis, pancreatitis, gastrointestinal bleeding (sometimes massive) due to gastritis, varices and esophagitis, cancer, diarrhea
- Bone marrow: Abnormal blood counts including anemia
- Psychiatric and social: Depression, anxiety, suicide, violent behavior, marital/occupational/family problems, abuse of other drugs and alcohol
- Various: Aspiration pneumonia, accidents and trauma. Alcoholism is a primary, chronic disease with genetic, psychosocial and environmental factors influencing its development and manifestations. The disease can be progressive and fatal. It is characterized by impaired control over drinking, preoccupation with the drug alcohol, use of alcohol despite negative consequences, and distortions in thinking, especially denial. Each of these symptoms can be continuous or intermittent.
Life insurance underwriters also give negative ratings for binge drinking and risky drinking. “Binge drinking”; is defined as heavy drinking to the point of intoxication on a periodic basis. “Hazardous drinking” is more than 14 drinks per week or more than 4 per occasion, for men, and more than 7 drinks per week or more than 3 per occasion, for women.
If you are a moderate to heavy drinker or have a history of alcohol abuse, life insurance underwriters will typically request the following:
- Alcohol Questionnaire – This form will ask you some questions such as:
- Have you ever been in any legal trouble?
- What is your current level of alcohol consumption?
- Do you currently participate in any groups such as Alcoholics Anonymous?
- Motor Vehicle Record – Underwriters will review your driving history to discover if there is a history of drunk driving or careless driving.
- Treating Physician Statement – Reviewing your health report can reveal a number of alcohol abuse indicators. For example, a history of pancreatitis in a younger individual is highly indicative of heavy drinking.
Risk factors and life insurance cost
In addition to the risks associated with excessive alcohol consumption, the insurer also considers favorable historical items such as:
- active participation in Alcoholics Anonymous,
- voluntary start of treatment,
- single treatment period or hospital stay,
- maintaining a stable family life,
- permanent employment,
- financial solvency, and
- good health with no reports of violence or arrests.
If the individual manages to stop drinking alcohol without relapse, after seven to ten years, the mortality rate approaches that of the general population.