Term insurance medical tests: what they look for and why honesty is cheaper

Underwriting is the process by which an insurer decides what risk you represent and at what price. For term insurance it is the most consequential half-hour of the entire purchase, because everything decided there governs how the policy behaves for the next thirty years.

What triggers a medical

Whether you are asked for tests depends on your age, the sum insured, your declared history, and increasingly on the insurer's own risk models. Younger applicants taking modest cover are often issued on the strength of a declaration alone or a short telephonic interview. Larger sums insured and older applicants almost always face a full medical.

Tele-underwriting - a structured phone conversation with a medical professional - has become common for the middle band. It is recorded, and the answers you give in it form part of the contract exactly as a written declaration would.

What the tests typically cover

A standard panel usually includes height, weight and blood pressure, a fasting blood sugar or HbA1c, a lipid profile, liver and kidney function, a complete blood count, urinalysis, and a cotinine test for tobacco use. Older applicants or larger sums insured may add an ECG, a treadmill test, or a chest radiograph.

The cotinine test is worth naming explicitly. It detects nicotine metabolites and therefore detects tobacco use regardless of what was declared. Smoker rates can be substantially higher than non-smoker rates, and a non-smoker declaration contradicted by a positive test is a clear misrepresentation.

The medical test is not the risk. The undeclared history is.

Why non-disclosure is the expensive choice

Indian insurance law gives insurers a defined window in which a life policy can be called into question. Beyond three years from issuance, commencement of risk, revival or rider addition - whichever is latest - a life policy cannot be called in question on any ground whatsoever. Misstatement, suppression of material fact and fraud all have to be raised inside that three-year window or not at all.

That protection is genuinely strong. It is also not a reason to gamble, because a claim inside the three-year window is exactly when a young family is least able to absorb a repudiation, and because insurers investigate early claims thoroughly, obtaining hospital records and prescription histories.

The arithmetic is straightforward. Declaring a manageable condition typically results in a loading - a percentage increase in premium - or occasionally an exclusion. Concealing it risks the entire sum insured. A loading is a known cost; a repudiation is a catastrophic one.

Preparing for the medical

Fast for the period the insurer specifies, usually eight to twelve hours. Avoid alcohol for a couple of days beforehand, since it distorts liver markers. Sleep normally the night before and avoid heavy exertion that morning, both of which affect blood pressure readings.

If a reading comes back borderline because of a temporary factor, you can ask to be retested. It is a reasonable request and insurers accommodate it more often than applicants realise.

After the decision

If the policy is issued with a loading or an exclusion, read the endorsement rather than filing it. Some loadings can be reviewed after a period if the underlying factor improves - weight and blood pressure being the usual candidates - and it is worth asking under what conditions the insurer would reconsider.

You also have a free-look period after receiving the documents, during which you can return the policy if the terms are not what you agreed to. Read the schedule inside that window, not a year later.