A provider can legally require an applicant to undergo a physical examination when considering the applicant's eligibility for life insurance. Most insurance providers will require that applicants go through a physical examination by a doctor or nurse, in which urine and blood samples will be taken. The provider will also typically request the medical records of the applicant from her physician.
Can an Insurance Provider Do Any Additional Background Checks on the Applicant?
Yes. The provider can look at the applicant's health history with the Medical Information Bureau, the applicant's driving record, and whatever other information is relevant to deciding the eligibility of the applicant.
While state laws regulate what information a provider can use in determining the eligibility of an applicant for a life insurance policy, the biggest regulating force in determining how much checking the provider is going to do is the cost/benefit ratio. It costs money for the provider to do these background checks, so how many checks they do will normally be dependent upon how large of a policy the applicant is going for. A provider will do more checking into a person seeking a $1,000,000 policy than a person seeking a $100,000 policy.
What Can I Do If I Think My Life Insurance Provider Is Going to Improper Lengths with Background Checks?
If you feel your provider is doing background checks that will result in you being unfairly discriminated against in terms of your eligibility for an insurance policy, you may want to consult an attorney who is experienced in life insurance matters. Your attorney can advise you of your rights and help you decide how to proceed.
Also, if your lawyer advises you that your provider has illegally discriminated against you or your application, you may also want to file a complaint with your state's Department of Insurance.