smiling middle aged male face
As we get older, the wrinkles will only go where the smiles have been - Jimmy Buffett

Getting your Life Insurance policy and Income Protection policy can sometimes take longer than people might expect and the main reason why is simple.

Once you have this type of policy, it can’t be taken away from you or cancelled by the insurance company, regardless of any future changes to your health or occupation.

The life insurance Underwriter has to get it right the first time because they don't get a second chance to fix a problem they may have originally overlooked.

Read in this article:


So what is Guaranteed Renewable and why should I care?

A little known or understood benefit of a high quality Life Insurance or Income Protection policy is that it is, ‘guaranteed renewable’.

  • Unlike your car insurance and other general insurance policies, high quality Life Insurance products offer what's known as guaranteed renewable policies.
  • This means that each year your policy is renewed the insurance company must continue to cover you under the same original terms and conditions from when you first received the policy, regardless of any changes that may have occurred to your health or occupation in the meantime.

This is how it works in your favour

Once you're cover is in place, (and you’re paying the premiums when due) the insurance company;

  • cannot cancel your cover
  • cannot change the policy terms to your detriment
  • cannot place any further restrictions on your policy, and
  • cannot single you out and increase your premiums because of changes to your health, new occupation, smoking status or sports or pastimes.

In practical terms, if you later in life change your job and became a 'bomb disposal expert' (an uninsurable occupation - just so you know) started smoking (never recommended) started to play high-impact sports, perhaps outdoor 'free soloing’ rock climbing (don’t even get me started on this level of crazy) or if you find over time you’re having to deal with a deteriorating health condition - the insurance company still cannot revoke your cover or change what you're covered for.

We all risk becoming uninsurable as we get older so we need a strategy to get our insurance cover in place while we still can

This is one of the biggest reasons we advise clients to use a strategy and to get their cover in place very early (before you tear your cruciate ligament in a weekend soccer game before you fall off the wheelie bin while clearing leaves out of the gutter one weekend and damage your back, before your decide to start vaping - as a way to stop smoking - or start competing in mixed martial arts tournaments on the weekend while working part-time in the army reserve …. you get the idea.

Get your insurance sorted while you're in the lowest risk time of your life and enjoy the lower costs and the certainty that having a safety net brings you and your family.

Pro Tip: The statistical reality is we become harder to insure the more life happens to us all. Over time we develop injuries and illnesses that need to be managed so one way to protect ourselves against major changes in life and health is to include the optional extra benefit to a policy called Guaranteed Future Insurability.

Guaranteed Future Insurability

This is an option you can add to a policy at application time where you can purchase the right to increase your amount of insurance cover in the future (with no medical assessment) if you have a major listed event in your policy like:

  • Getting Married
  • Having a new child arrive
  • Commencing a new mortgage or
  • Refinancing a mortgage

If you experience any one of these listed events and have included the Guaranteed Future Insurability option when you first applied for cover, you could still increase the amount of your insurance cover without the need for a new medical assessment or underwriting.

Never miss a chance to reduce your insurance premiums when you reduce your insurance risks

Pro Tip: Remember, if your occupation becomes less risky, (or you stop smoking or your health improves from the time you originally made your insurance application) make sure you tell your insurance provider as your premiums could be reduced.

The Good news about a Guaranteed Renewable life insurance policy

The bottom line is once a life insurance company takes you on - they take on your future risks as well - so no matter how your behaviours change, you’re guaranteed the terms of your policy from the day you took it out.


author pic drew browneDrew Browne is a specialty Financial Risk Advisor working with Small Business Owners & their Families, Dual Income Professional Couples, and diverse families. He's an award-winning writer, speaker, financial adviser and business strategy mentor. His business Sapience Financial Group is committed to using business solutions for good in the community. In 2015 he was certified as a B Corp., and in 2017 was recognised in the inaugural Australian National Businesses of Tomorrow Awards. Today he advises Small Business Owners and their families, on how to protect themselves, from their businesses.  He writes for successful Small Business Owners and Industry publications. You can read his Modern Small Business Leadership Blog here. You can connect with him on LinkedIn Any information provided is general advice only and we have not considered your personal circumstances. Before making any decision on the basis of this advice you should consider if the advice is appropriate for you based on your particular circumstance.

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