Life Insurance and Pre-Existing Conditions – Buying life insurance at a younger age and in good health often means lower premiums.
However, having a pre-existing health condition can affect your coverage options. It may lead to higher costs or fewer choices, but it usually does not mean you are disqualified.
What Is a Pre-Existing Condition?
A pre-existing condition refers to any illness or health issue you were diagnosed with or treated for before applying for life insurance. Common examples include
- Diabetes
- Heart disease
- High blood pressure
- Cancer
- HIV
- Obesity
- Asthma
- Depression, and more.
Each insurance company has its own way of assessing risk, known as underwriting. Some are more flexible with certain conditions than others. Your health history can influence which risk class you fall into such as standard or substandard and this will affect your premiums.
How Much Will It Cost?
Insurers place applicants in categories based on expected life expectancy. If your condition increases your health risk, you may be offered substandard rates, which are more expensive. In some cases, if the risk is considered too high, coverage might be denied.
Thanks to medical advances, some conditions are now easier to manage. If your health is stable or you are in remission, your rates could be more affordable than expected.
Options for Life Insurance with a Pre-Existing Condition
If you have a pre-existing health condition, getting life insurance may feel challenging — but there are still options available. While the coverage might cost more or come with limits, you can still find a policy that works for your needs. Here are a few types of life insurance you can consider:
Guaranteed Issue Life Insurance
If you are unable to qualify for standard term or permanent life insurance, guaranteed issue policies are an option. These plans do not require a medical exam or health questions, and approval is almost always guaranteed for those in the right age range.
However, this convenience comes with trade-offs. The premiums are high, and coverage amounts are low. These policies often offer limited death benefits, typically up to $25,000, and may include a waiting period. Full payouts may only occur after the policy has been in place for a few years unless death is caused by an accident.
Group Life Insurance from Your Employer
Many employers offer basic group life insurance to all employees, including those with health conditions. These policies do not require a medical exam and are generally low-cost or free. Coverage amounts are usually limited, and the policy may end if you leave the job.
Accidental Death and Dismemberment (AD&D) Insurance
AD&D insurance is another option if you are unable to get traditional coverage. This type of policy pays a benefit only if death occurs due to a qualifying accident. Since it does not consider your health history, pre-existing conditions do not affect your ability to qualify. However, benefits are not paid for deaths caused by illness or natural causes.
Tips to Get Life Insurance With Pre-Existing Conditions
If you’re trying to buy life insurance with a pre-existing condition, the process can feel discouraging, but there are ways to improve your chances of getting coverage and possibly lowering your premiums over time.
- Apply at the right time: Timing matters. Applying right after a serious diagnosis may lead to rejection, but many insurers will reconsider once you’ve been stable or in remission for a certain period.
- Improve your health: If your condition improves, you can request a reassessment, known as a re-rating, which may reduce your premium.
- Work with the right agent: An independent agent who partners with impaired risk specialists can help you find insurers that are more accepting of your condition. They can also make informal inquiries that don’t impact your record with the MIB (Medical Information Bureau).
What if you’re denied coverage?
Being declined doesn’t mean the end of the road. You can wait and reapply once your health improves. Some people also explore alternatives like investing the money they would have spent on premiums to build financial support for loved ones over time.
