Let us start with what is BMI?

BMI stands for Body Mass Index. It is a medical tool used by the medical profession to assess someone's approximate body fat.

• BMI is a function of a person's height and weight. Doctors often use this in conjunction with a person’s waist measurement to get a more accurate understanding of how healthy a person's weight is.

I am guessing you would not be too happy to have your financial adviser measure you for your insurance application, so insurance companies only use height and weight.

The formula for BMI = Weight(Kg) / (Height(M) x Height(M))

BMI uses a scale to assess your weight category.

• Under 19 is considered under weight
• 19-24 is considered normal weight
• 25-29 is considered overweight
• 30-34 is considered obese
• 35-39 is considered obese II
• Over 40 are considered morbidly obese and pose significant health risks.

The insurance companies, for a similar reason to doctors, assess your health risks. They use BMI as part of their overall assessment. Before you panic about your number, as people often do, read on.

• In New Zealand, the prevailing attitude to weight by women is they feel they are overweight and need to lose weight, while with men, they are just fine and healthy.

In my experience with clients, when comparing them to the BMI scale, perception is often backward.

• New Zealand women often fall into the normal weight range, and men often fall into the overweight category.
• That is not to say that people are not significantly overweight, but the self-perceptions are often different from the medical point of view.

My personal situation is a case in point.

• I am fit and healthy, my doctor and my personal trainer both say so. My current cardiac risk is <2%, but my BMI is 28-29, so my BMI is borderline obese.
• Yes, I'm working on losing a couple of kg, but even 4 kg lighter, this will still have my BMI at about 27. Realistically being under 25 for BMI for me is a pipe dream.

How is this possible you ask?

BMI is a guide and does not account for muscle mass and bone density particularly well.

• BMI is designed to give you an indication based on an average human, so it's a guide but not absolute. This is where we get back to the insurance side of things.

The insurance companies understand that BMI is a guide, it is not completely accurate, but it is the best guide we have available.

• We commonly find that BMI for Asian and Indian cultures tends to under-assess body fat, and for Nordic and Pacific Island cultures, BMI over-assesses body fat.

That is not to say there is not a problem to address if you have a BMI of 40 regardless of cultural background.

How does this apply to insurance?

If you are under 19 for BMI

The insurance company will have a closer look at you, if you have a reason to be this way they generally will not penalise you for it.

• Being light boned and you maintaining your weight, and your doctor has a medical history with no concerns you will be fine.
• However, if you have an eating disorder or your doctor has concerns about your weight in your medical history, they will have a closer look.
• It may not mean they will change your terms and conditions, but it might take a little longer for a decision to come back.

BMI between 19 and 30

We generally find insurance companies quite reasonable in their underwriting, as this is considered the normal weight range.

1. 19-24 is a normal weight range for BMI that does not warrant investigation.
2. 25-30 doctors tend not to comment about weight in this range unless there is a need to because of some underlying medical condition.
   • The insurance companies are guided by the medical opinion when looking at assessment for underwriting and claims.

BMI in this range gets a closer look at underwriting if an applicant has diabetes, either Type 1 or 2.

• If you have diabetes and your BMI is above 24, the insurance company will appear harsh in their decisions.
• However, your adviser should also be doing their homework and discussing with you what cover you can have and how you go about getting it.

BMI Above 30

We start getting into non-standard policy terms. What I am talking about is loadings.

• Loadings are a % of the standard premium over and above the standard premium.
• Usually, this is done in 25% steps from 50%, so a 50% loading would be 1.5 times the standard premium.

When it comes to BMI, the policy type you are applying for and your BMI will determine whether a loading may apply.

• For instance, some insurance companies start loading their cover at a BMI of 31, others at a BMI of 32, and some will only load specific benefits and not others at the lower end.
• Other insurers have continued to adapt, and we can offer standard-rate life and medical cover to people with a BMI of 34 or 35.

Talking to your adviser to arrange the right sort of cover and negotiate your underwriting terms with the insurance companies will give you a clearer picture from day one and minimise your surprises.

My BMI is in the high 30's, what now?

If you are in the high 30s and have a BMI of 37/38, you can expect loadings on all benefits, including life cover.

• These loadings can be in the region of 2-3 times the standard premium.
• This is not just because of your weight; past health conditions and your immediate family's medical history now play a significant part in assessing your risks.

The important thing is to have cover; many people get offended when they have to face this and do nothing.

• The insurance company increases the premium because there is an increased risk of you claiming.
• Take the cover at the higher premium, or what you can afford to take, and then focus on improving your health situation.
• If something happens, it will not be as bad financially for you as having no insurance cover at all.

As you reduce weight, we can ask the insurance company to reassess your insurance cover and we often do this for clients.

• It is in your interest, as it will save you a premium, not to mention the health benefits you will receive.
• The process of loading re-assessment for weight generally takes 12-18 months, as the insurance company wants to see the weight loss and its maintenance over time.

I am heavy, really heavy, and my BMI is over 40?

Insurance companies understand that humans put on weight as we get older, so the older you are, the heavier you can be before loadings start to be applied.

• For this reason, a 25-year-old with a BMI of 35 is going to get a larger loading than a 55-year-old with a BMI of 35 for the same policy benefit.

At this end of the scale, medical conditions aside, we start to see the insurance companies decline to offer coverage purely on weight.

• Carrying weight long term at this level puts significant stress on the body and organs which result in significant claims, claims which are not a matter of chance but a matter of when.
  • Joints, hips, knees and backs are often the first to see this.
  • With your organs, the pancreas with diabetes, blood pressure and heart disease are often signs things are not well.
• Because of this, if you have a BMI of 40 or more, you can expect all insurance companies to decline you for Trauma/Critical Illness, income protection/Mortgage Protection, Permanent Disability and Health/Medical Insurance just on your weight.
• If you have a BMI of 45 or more then Life Cover is likely to be declined as well.

It is a case of never say never. Talk to us about your situation. We may be able to arrange suitable or even better cover, or we may be able to reduce the premiums you pay for your current cover.

At the very least, we can give you a clear understanding of your insurable situation and put together a plan to get you covered in the future. We're here to help get in touch