Understanding Adverse Selection
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Understanding Adverse Selection
One of the things that a Mortgage Life Insurance Quote does not take into consideration is something called adverse selection (also called anti-selection). Adverse selection occurs when someone who is already ill or is in a dangerous profession attempts to get life insurance without disclosing that they present an unusually high risk. Because a Mortgage Life Insurance Quote is given before the underwriting process is complete, there is no way for an insurance professional to give an appropriate Mortgage Life Insurance Quote in the event of adverse selection because they're not aware of the true facts.
It's important to remember that any material misrepresentation on an application can result in the denial of a claim after death or the revocation of a life insurance policy. It's important that you are completely honest at all times about the risk that you present to the insurer. Without complete disclosure, you could be setting your beneficiary up for needless financial disappointment as your mortgage life insurance claim is denied.
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