Getting a life insurance policy while having a charge for Driving Under Influence(DUI) or Driving While Impaired (DWI) on your record can be tough because many life insurance companies will turn you down.
Some will place your application on hold until further notice. And if you get any offer, your premium will be higher; those are simply the facts.
If you belong to this category of people, do not despair anymore; there is a bright light at the end of the tunnel.
It IS still possible for you to get life insurance, and you can get it at a reasonable rate considering your circumstances. Of course, the matter at hand is,
How do you go about getting the life insurance you need?
Life Insurance After a DUI
When it comes to life insurance, your fate with the underwriters depends on the answers to six critical questions. So, it is in your best interest to know these questions and understand their implications.
The six critical questions are:
- Why do life insurance companies pay so much attention to DUIs?
- What are the questions that insurance companies will likely ask you?
- What impact does a very recent DUI have on your premiums?
- What will your premium be following a DUI?
- Will a non-medical exam policy help with a DUI on your record?
- What insurance companies are most suitable for you with a DUI on your record?
Now, let’s discuss each question in full detail.
Why do life insurance companies pay so much attention to DUIs?
Underwriters actually assess risks on each potential client applying for life insurance. It helps if you think about insurance companies like casino companies. They are in business because the odds are in their favor, to be blunt.
Insurance companies are in business because the total premium paid in each year by all their customers is much more than the compensation they pay out each year. And they want to keep it that way.
Profit protection is the reason you get declined for insurance or the reason your premiums are high with certain health issues for life insurance.
So they use all the data available to them to determine how likely or how soon an applicant will die; that’s not a myth. On that note, following a DUI conviction, insurance companies may find a few issues with your application. The following statistics give them pause when it comes to individuals with DUIs:
- As a person with a DUI, there is a probability that you will die in an alcohol-related crash. This probability is not far-fetched. The National Highway Traffic Safety Administration established that being convicted of a DUI gives you a 40% chance of getting involved in a crash caused by drunkenness.
- You are not likely to stop your drinking-and-driving habit in the eyes of the underwriter. According to recent statistics, 30% of the people who receive DUIs get convicted more than once.
- Alcoholism is sometimes the foundation of some other health issues.
- Driving under the influence of alcohol is a significant risk. If you can take such a risk, you will likely take some other dangerous risks, which in turn exposes the insurance company further.
For these reasons, underwriters either decline your application or charge you more for insurance.
What are the questions that insurance companies will likely ask you?
To be able to assess how risky you are as a driver, underwriters will ask the following questions directly or indirectly.
- They will ask you how many DUI convictions you have had. There is no point in lying because they will still verify the information you provide.
- They are also interested in the dates of your convictions. Insurance companies aren’t too happy with recent convictions.
- They also need to know whether your license was suspended or revoked. Please don’t lead them on a wild goose chase. Let your independent broker know your driving restrictions upfront, both past and present restrictions.
- They also need to know if traffic violations are a common occurrence for you. If you’ve had any speeding tickets, you should tell them.
- It is important for them to determine if you are a social drinker, heavy drinker or a non-drinker. If they find that you are a light drinker, then you may receive a bit of favor from the underwriter.
- Finally, to cap it all off, they want to know if you have been involved in any case of alcohol abuse recently or not so recently.
It is not advisable to lie to your agent or the underwriter.
Lying will definitely backfire in the end. It is better to bare it all to your agent because, only then, will he or she able to really help you. Bear in mind your agent and underwriter can quickly fact check you by pulling your Motor Vehicle Report.
With access to your driving record, there is no reason to be less than truthful when applying for life insurance. Additionally, you may be subjected to a thorough medical examination to verify signs of alcohol abuse too.
What impact does a very recent DUI have on premiums?
A very recent DUI conviction matters a lot.
When it comes to life insurance, whatever happened long ago is not likely to have as much impact now, provided it’s not been repeated. In fact, a DUI conviction that took place in the last six months has more impact than two DUI convictions that occurred over ten years ago.
Underwriters believe that the longer the period after you committed an offense the less likely you will commit it again. Someone who was convicted of a DUI over ten years ago has already proved that he or she is not likely going to repeat the violation again.
However, someone who was convicted just six months ago needs more time to demonstrate that he or she will not repeat the driving offense, and until then, his or her chances of getting another DUI is seen as high in the eyes of an underwriter.
How underwriters view you is why you need to be careful with where you apply for life insurance. If your DUI case is still within the last six months, your application will either be placed on hold (postponed) or rejected outright.
However, there is some hope since there is a carrier who will still consider you for life insurance even if your DUI case is still within the last 12 months.
What is the likely insurance premium after a DUI conviction?
A DUI conviction is not a real health issue, but it sure increases your chances of dying pretty soon albeit in an alcohol-related crash. Hence, it increases your premium. However, other factors are considered too.
Also, during an assessment of your application underwriters consider the time of last conviction, your gender, and your health class.
For example, a 35-year-old female applicant rated at Table 2 health class with 1 DUI conviction that occurred less than 12 months ago will pay (per month):
- $44.51 for 250k in coverage on a 20-year term
- $81.36 for 500k in coverage on a 20-year term
- $118.21 for 750k in coverage on a 20-year term
Rates subject to change. Please see your independent broker for the best/current pricing.
It’s important to remember that in the calculation of these rates, it is assumed that the applicant has no health issues. If she or he does, then the figures may be higher since health issues shorten your life expectancy.
Will a non-medical exam policy help with a DUI on your record?
The simple answer is NO!
A non-med policy is for those that do not wish to submit to the medical examination. Additionally, it costs a little more than a traditional fully underwritten policy.
So, if you don’t want to submit to a medical exam, that is your choice and totally fine. However, if you think this will hide your DUI/DWI, you are wrong. They will pull your Motor Vehicle Record (MVR).
What insurance companies are most suitable for individuals with DUIs?
The most suitable insurance carrier for many individuals with DUIs is Prudential, for now.
Of course, Prudential doesn’t approve everyone with a DUI who needs life insurance. The health record of every applicant is unique and so are the circumstances surrounding their DUI cases. Apart from DUI conviction, other factors discussed above are also considered.
In fact, your DUI conviction may not disqualify you for life insurance coverage, but your health issues may preclude you.
The rules and guidelines for life insurance policies can change without any notice.
Although Prudential is one of the most lenient today, the company could very well change their underwriting guidelines on DUIs in the next few weeks.
In other words, the best provider for life insurance is truly determined on a case by case basis. You should contact a trusted and knowledgeable independent life insurance professional to determine if Prudential is the best for you.
We have helped many clients secure affordable life insurance coverage with a DUI or DWI conviction.