Bipolar Disorder: Life Insurance Options And Availability

People with bipolar disorder can get life insurance, but it may be more difficult and expensive. The availability and cost of life insurance for people with bipolar disorder depend on the severity and treatment of their condition, as well as their overall health and lifestyle. Some insurers may be more accommodating than others, so it's important to shop around and be transparent about your diagnosis and treatment history.

How does bipolar disorder affect life insurance?

Bipolar disorder can affect life insurance in several ways. Firstly, it can lead to increased premiums. The increase in premiums depends on the frequency, severity, treatment, and diagnosis details of the condition. If an individual has a milder form of bipolar disorder and has had it under control for a significant period, they may still qualify for most life insurance policies, albeit with higher rates. Life insurance providers may also postpone the application of someone with bipolar disorder by one or two years to observe the progress of their treatment.

Secondly, bipolar disorder may result in a person's application for life insurance being denied. This is more likely to occur if there is a high risk that the disorder will affect the applicant's life expectancy, as bipolar disorder is associated with a significantly higher suicide rate than the general population. In such cases, insurers may offer coverage with certain exclusions and higher premium rates, or they may deny coverage altogether.

Thirdly, the type of bipolar disorder an individual has may impact their life insurance options. Bipolar 1 disorder, which involves more intense and significant manic and depressive episodes than bipolar 2 disorder, may result in more limited options and higher rates.

Additionally, the treatment plan for bipolar disorder can influence the underwriting process. Life insurance companies view intensive treatment plans, such as electroconvulsive therapy, less favourably than less intensive plans, such as psychotherapy. Frequent changes in medication or multiple treating physicians may also be seen as indicators of instability.

Lastly, bipolar disorder can affect the type of life insurance an individual qualifies for. While those with mild bipolar disorder may be eligible for various types of life insurance, including term life, whole life, and universal life insurance, those with more severe cases may only qualify for guaranteed issue life insurance, which has higher premiums and lower coverage amounts.

What do life insurance companies look for with a bipolar diagnosis?

When applying for life insurance, people with bipolar disorder may be asked to provide additional details about their mental health history. Life insurance companies will want to know:

• The history of your bipolar diagnosis
• Whether your mental illness has led to any hospitalizations or time off work
• How long you've been undergoing successful treatment
• The number of medications you've been on
• If your medication has changed

Underwriters will use this information to categorize your diagnosis as mild, moderate, or severe, which will determine whether your application is approved, postponed, or declined, and whether you will be subject to premium increases.

In addition to the above, life insurance companies will also want to know:

• Whether you are following your treatment plan
• If you have other medical conditions
• Your height and weight
• Whether you use tobacco or drugs
• Your driving record

They will also require a medical exam, blood draw, and urine sample, and will order your medical records to ensure your bipolar disorder is stable and that you are following your treatment plan.

If you are employed full-time, this will prove to insurance carriers that you can manage your condition while maintaining employment, which will work in your favour. Hospitalizations due to bipolar disorder could negatively impact your application, especially if they were the result of suicidal ideation or an attempt.

The type of medication you are taking will also be considered. Life insurance companies generally don't have an issue with people taking one or two non-antipsychotic medications, but if you take antipsychotics, you may be denied or given a table rating.

The intensity of your treatment plan will also be assessed. Less intensive plans, such as psychotherapy, will be viewed more favourably than more intensive treatments, such as electroconvulsive therapy.

Finally, the type of bipolar disorder you have matters. Bipolar 1 disorder presents more intense and significant manic and depressive episodes than bipolar 2 disorder, so individuals with bipolar 1 disorder may have fewer options and pay higher rates.

What types of life insurance policies are available?

There are several types of life insurance policies available, each with its own unique features and benefits. Here are the most common types:

• Term Life Insurance: This is the most basic type of life insurance and is typically sold in terms of one, five, 10, 15, 20, 25, or 30 years. It is designed to provide coverage for a set period and is generally the cheapest option. If you outlive the policy, your beneficiaries won't receive a payout.
• Whole Life Insurance: This type of insurance is permanent and lasts your entire life as long as you keep up with the premiums. It includes a cash value component that functions like a savings account, allowing you to take out loans or pay policy premiums. Whole life insurance is generally more expensive than term life insurance.
• Universal Life Insurance: This is another form of permanent life insurance that offers flexibility. It allows you to adjust your premiums and death benefit within certain limits. Universal life insurance has a cash value component that grows based on market interest rates.
• Variable Life Insurance: This type of insurance is tied to investment accounts such as bonds and mutual funds. It offers the potential for considerable gains if your investments perform well but requires active management as the cash value can change daily.
• Burial or Final Expense Insurance: This is a small whole life insurance policy designed to cover funeral, burial, and other end-of-life expenses. It typically has a guaranteed death benefit ranging from $5,000 to $25,000 and does not usually require a medical exam, making it accessible to seniors with pre-existing health conditions.

In addition to these main types, there are also other variations, such as indexed universal life insurance, simplified issue life insurance, and guaranteed issue life insurance. The best type of life insurance depends on your individual needs and budget.

What information about bipolar disorder must be disclosed when applying?

When applying for life insurance, it is important to be transparent about your mental health history. This includes disclosing any physical and mental health diagnoses, procedures you have undergone, medications you are taking, and your family's health history. Here is a list of information about bipolar disorder that must be disclosed when applying for life insurance:

• History of bipolar diagnosis: Life insurance companies will want to know the history of your bipolar diagnosis, including the date of diagnosis, the severity of the disorder, and any changes in medication. They will also want to know if you have been diagnosed with Bipolar 1 or Bipolar 2 Disorder, as this may impact your insurance options.
• Hospitalizations and time off work: You will need to disclose any hospitalizations or time off work related to your mental health. This includes hospitalizations due to suicidal ideation or attempts, as this may impact your eligibility for fully underwritten coverage.
• Treatment history: Insurance providers will want to know how long you have been undergoing treatment and the success of your treatment plan. They may also ask about the type of treatment, such as psychotherapy or electroconvulsive therapy, and whether you are consistently following your treatment plan.
• Medication: It is important to disclose the number of medications you are taking, the types of medication (including antipsychotics), and any changes in medication. Life insurance companies generally do not have an issue with one or two non-antipsychotic medications but may view antipsychotics as a higher risk.
• Impact on daily life: Insurers will want to know if your bipolar disorder affects your daily activities and ability to work. They may view gainful employment positively, as it demonstrates that you can manage your condition while maintaining employment.
• Substance abuse: Life insurance companies will want to know if you have a history of substance abuse, as this can be a contributing factor to bipolar disorder.
• Suicide attempts: Any prior suicide attempts must be disclosed, as this may impact your eligibility for coverage.

Remember that nondisclosure of critical information or lying on your application can invalidate your policy and result in your beneficiaries being denied the policy's death benefit. It is always best to be transparent and provide as much information as possible when applying for life insurance with a bipolar diagnosis.

How can individuals with bipolar disorder improve their chances of getting better rates?

Individuals with bipolar disorder can improve their chances of getting better insurance rates by taking the following steps:

• Seeking treatment and adhering to a treatment plan: Life insurance companies want to see that the condition is under control and being actively maintained. This includes undergoing successful treatment and following a treatment plan prescribed by a medical professional. Regularly taking medication as prescribed is an important part of managing bipolar disorder and can help earn a higher life insurance rating.
• Maintaining a stable lifestyle: Bipolar disorder can interfere with daily activities, such as holding down a job or maintaining social relationships. Demonstrating the ability to function normally and responsibly can improve the chances of obtaining better insurance rates. This includes having gainful employment, which shows that the individual can earn an income and manage their condition while maintaining employment.
• Avoiding hospitalizations and suicide attempts: Hospitalizations due to bipolar disorder, especially those related to suicidal ideation or attempts, can negatively impact insurance rates. Avoiding hospitalizations and demonstrating stability can improve the chances of obtaining better rates.
• Choosing the right insurance company: Not all insurance companies have the same criteria for assessing individuals with bipolar disorder. Shopping around and comparing rates from multiple companies can help find those that are more favourable towards individuals with bipolar disorder. Working with an experienced insurance agent can also increase the chances of obtaining better rates.
• Disclosing complete and accurate information: Incomplete or inconsistent medical records can be a concern for insurance companies. Providing comprehensive and accurate information about mental health history, treatment plans, and compliance can help insurance underwriters better assess the risk and potentially offer lower rates.
• Improving physical health: Individuals with bipolar disorder often have higher rates of physical health conditions, such as thyroid disease, cardiovascular disease, diabetes, and obesity. Addressing these physical health issues and improving overall health can positively impact insurance rates.
• Applying for a re-evaluation of rates: If an individual with bipolar disorder is paying higher rates than they should, they can request a re-evaluation of their insurance rates after demonstrating that their treatment has been successful and their condition has been under control for a significant period.

Frequently asked questions