Life Insurance: Can Pre-Existing Conditions Affect Your Coverage Increase?

Life insurance is a valuable tool to protect loved ones and enhance financial planning. However, for those with pre-existing conditions, the process of obtaining life insurance can be challenging and often more expensive. Pre-existing conditions are medical issues diagnosed or treated before applying for life insurance, and they can impact the cost and availability of coverage. While it may be more difficult, individuals with pre-existing conditions can still obtain life insurance, and understanding the factors that influence approval chances is essential. These factors include the type of condition, current health status, age, and lifestyle habits. Shopping around for insurance and working with independent agents or brokers can help individuals find the best options for their specific circumstances. Additionally, following treatment plans and maintaining a healthy lifestyle can increase the chances of approval and lower premiums. This paragraph introduces the topic of obtaining life insurance with pre-existing conditions, highlighting the challenges and providing an overview of the factors and strategies that can impact an individual's success in securing coverage.

Types of life insurance for people with pre-existing conditions

People with pre-existing conditions can still qualify for various life insurance policies. However, they may pay more in premiums because personal health history is a key factor that insurers use to calculate rates. Insurers must account for the additional risk that a pre-existing condition brings when making a policy decision.

Term life insurance

Term life insurance policies have more favourable premiums and large death benefits, but coverage only lasts 10 to 30 years. This policy may be right for you if you’d like the most coverage for your budget.

Guaranteed issue life insurance

A guaranteed issue life insurance policy never denies applicants. There are no medical questions or exams. These policies don’t offer a lot of coverage, but they have favourable premiums and a cash value growth component that helps you build wealth with each payment.

Group life insurance

Group life insurance is a term life insurance policy you can get through your employer if they offer it. Employers tend not to offer more than $50,000 of death benefit coverage for tax reasons, but premiums can be favourable and easy to manage. Many people, including those with health problems, can get basic group life insurance through their employers.

Whole life insurance

People with pre-existing conditions could still qualify for whole life insurance. This coverage lasts for life and offers a cash value growth component, allowing you to build wealth. However, premiums can be much higher. Guardian Life, for example, offers a whole life insurance product for people with HIV.

Accidental death and dismemberment insurance

If you don’t qualify for a term or permanent life insurance policy, you may want to consider accidental death and dismemberment insurance. The death benefit is paid out only in the event of an accidental death, which means your medical history is not used to determine eligibility.

Tips for buying life insurance with a pre-existing condition

• Be mindful of when you apply. An insurer will likely turn you down if you apply shortly after a cancer diagnosis or a heart attack, but you can always reapply, especially if your medical records demonstrate that your treatment has been effective.
• Take advantage of improvements in your health. If you are accepted but are being charged a high rate, you can ask for a life insurance re-rating (and a lower premium) once your condition is under control and your prognosis is positive.
• Find the right agent. It’s important to look for an independent life insurance agent who works with an impaired risk specialist. Make sure your agent is submitting informal inquiries rather than formal applications that will be recorded by the MIB Group.
• Get quotes from a handful of insurers. Insurance companies can be unique in how they review specific health conditions. Compare life insurance quotes to make sure you're getting the best possible coverage at the best possible price.

How to increase your chances of approval

Having a pre-existing condition doesn't necessarily disqualify you from getting life insurance. However, it can make the process more challenging and expensive. Here are some tips to increase your chances of approval when applying for life insurance with a pre-existing condition:

Stick to Your Treatment Plan

Adhering to your treatment plan is crucial. It demonstrates to the insurer that you are proactive in managing your condition and can help improve your overall health. Provide proof of regular visits to your healthcare provider, take any prescribed medications, and follow their medical advice.

Exercise Regularly

Regular exercise benefits your overall health and can help reduce the risks or symptoms associated with your pre-existing condition. It showcases your commitment to managing your health and can positively influence the insurer's perception of your application.

Maintain a Healthy Weight

If you are overweight, losing weight can increase your chances of approval. Achieving a healthy weight can lead to positive health effects, such as reduced blood pressure and improved blood sugar control, lowering the likelihood of developing other conditions. However, ensure you aim for a healthy weight range, as being underweight can also lead to health risks that may impact your approval chances.

Shop Around for Insurance Providers

Different insurance companies have varying criteria for evaluating applicants with pre-existing conditions. By shopping around and comparing quotes, you can find insurers more accommodating to your specific condition and potentially secure better rates and terms.

Work with an Insurance Broker

Consider working with an experienced insurance broker who can guide you through the process. They can help you navigate the complex landscape of insurance options and advocate for your best interests. A good broker will have insights into which insurance companies are more favourable towards specific pre-existing conditions.

Be Transparent and Accurate

Honesty is essential when applying for life insurance. Do not conceal or misrepresent your health condition on your application. Insurance companies have methods to identify fraud, and if they discover any discrepancies, it could lead to disqualification or a significant increase in premiums. Transparency demonstrates your trustworthiness as an applicant.

What to do if you're denied coverage

It can be challenging to get life insurance if you have a pre-existing condition, and you may be denied coverage altogether. Here are some steps you can take if your life insurance application is denied:

Ask for More Information

Find out why your application was denied by contacting the insurance company or agent. There could be various reasons, including serious medical conditions, poor results from a medical exam, bankruptcy, a criminal record, a positive drug test, or even a dangerous hobby. Once you know the reason, you can provide additional information or evidence to appeal the decision.

Check with Your Workplace

Consider checking with your employer to see if they offer a group term life insurance plan. While it may not provide the same level of coverage as an individual policy, it can offer some death benefits until you can secure your own term life insurance in the future. Group plans are usually free, but you can also supplement them for additional coverage at a cost. Remember that this type of insurance is often tied to your job, so you may lose the coverage if you leave your current employer.

Reach Out to a Life Insurance Agent

Consulting an independent life insurance agent can be beneficial when facing difficulties in getting insured. Agents understand the underwriting process and can help navigate any red flags in your application. They have access to a wider market and can assist in finding a suitable policy for your needs. They can also advise you on when to reapply or suggest alternative policy options.

Allow for a Waiting Period

Sometimes, it's worth considering a waiting period to address any health issues that led to your denial. Use the time to improve your health, such as by adopting healthier habits, quitting smoking, or exercising regularly. This can increase your chances of approval when you reapply. The waiting period can also help address non-medical reasons for denial, such as letting traffic violations fall off your record.

Apply Again for a Different Policy

If you're reaching an age where your current insurer no longer offers the type of life insurance you need, consider applying for a shorter-term policy. If you have a serious health condition and don't have access to employer-offered life insurance, explore no-medical-exam life insurance plans. These options include simplified issue life insurance, guaranteed issue life insurance, and mortgage life insurance. However, be aware that these alternatives may have limitations on benefits and higher costs.

How to get the lowest rates

Life insurance is a valuable tool to protect your loved ones and enhance your financial planning. Even with pre-existing conditions, it is possible to obtain life insurance, though it may be more challenging and expensive. Here are some strategies to help you secure the lowest rates:

Shop Around for the Best Rates

The best way to find the lowest rates is to compare prices from multiple insurers. Each insurance company has its own underwriting process and evaluates health conditions differently. By shopping around, you can find insurers that are more flexible about your specific condition and offer competitive rates. This approach ensures you get the coverage you need at a price that fits your budget.

Improve Your Insurability

There are several factors that insurers consider when assessing your risk profile. Here are some steps you can take to improve your insurability and potentially lower your rates:

• Follow your treatment plan: Adhering to your treatment plan demonstrates to insurers that you are actively managing your condition. Regularly visit your healthcare provider, take prescribed medications, and follow medical advice. This not only improves your health but also reduces the risk from the insurer's perspective.
• Exercise regularly: Regular exercise improves your overall health and can help reduce the risks or symptoms associated with your pre-existing condition. Evidence of a healthy lifestyle, including regular exercise, can increase your approval chances and lead to more favorable premiums.
• Maintain a healthy weight: Losing weight can positively impact your health and lower your risk profile. Achieving a healthy weight can lead to improved blood pressure, better blood sugar control, and a reduced chance of developing other conditions. However, note that being underweight can also lead to health risks, so aim for a balanced and healthy weight.
• Improve your overall health: Besides managing your pre-existing condition, focus on improving your overall health. This includes quitting smoking, avoiding risky activities, and adopting healthy habits. These improvements can positively impact your insurance application and premiums.

Work with an Independent Agent or Broker

Consider working with an independent agent or broker who has experience finding life insurance for individuals with pre-existing conditions. They will be familiar with the underwriting standards of different insurers and can advocate on your behalf. A good broker will know which insurance companies are more likely to offer favorable rates for your specific condition.

Be Mindful of Timing

The timing of your application can impact your chances of approval and the rates you receive. If you have recently been diagnosed with a serious condition, such as cancer or heart disease, you may want to wait until your treatment is well underway or completed. This allows you to demonstrate improvements in your health and increases your chances of securing lower rates.

Be Honest and Transparent

When applying for life insurance, it is crucial to be honest and transparent about your health conditions. Do not try to hide or misrepresent your medical history. Insurance companies have various methods to identify fraud, and if they discover any discrepancies, it could lead to higher premiums or even disqualification from coverage. Honesty is the best policy to ensure you get the coverage you need at the lowest possible rate.

How to buy life insurance with a pre-existing condition

Having a pre-existing condition doesn't mean you can't get life insurance, but it may affect your options and premiums. Here are some steps to help you buy life insurance with a pre-existing condition:

Understand pre-existing conditions:

A pre-existing condition is a medical issue you were diagnosed with or treated for before applying for life insurance. Common pre-existing conditions include high blood pressure, diabetes, cancer, asthma, and previous injuries. Your premiums will be determined by how these conditions affect your longevity.

Shop around:

The best way to get affordable rates with a pre-existing condition is to compare quotes from multiple insurers. Every insurance company has a different approach to qualifying customers and underwriting policies, so research your options.

Be mindful of timing:

An insurer is more likely to turn you down if you apply shortly after a serious diagnosis. You can always reapply if your treatment has been effective and your health has improved.

Work with an independent agent or broker:

Find an independent agent or broker who is familiar with the underwriting standards for each condition. They can check with insurers in advance to understand their approach to covering your specific condition.

Be honest:

Don't try to hide your medical condition. Misrepresenting yourself or omitting information on your application could be considered insurance fraud and may result in higher premiums or disqualification.

Take advantage of improvements in your health:

If you are accepted but charged a high rate, you can request a re-evaluation and a lower premium once your condition is under control and your prognosis is positive.

Consider alternative options:

If you are denied coverage or cannot find affordable premiums, consider guaranteed issue life insurance, which accepts all applicants but offers lower coverage and higher premiums. Group life insurance through your employer is another option, though coverage is usually limited and tied to your job.

Follow your treatment plan:

Adhering to your treatment plan and effectively managing your condition will increase your chances of approval and lower premiums. Provide documentation of your treatment and any improvements in your health.

Maintain a healthy lifestyle:

Regular exercise and a healthy weight can reduce the risks associated with your pre-existing condition and improve your approval chances.

Compare life insurance quotes:

Use online tools to compare life insurance quotes to ensure you're getting the best coverage and price.

Remember, age, health, lifestyle, and gender all play a role in determining your life insurance rates. By following these steps, you can increase your chances of obtaining life insurance with a pre-existing condition.

Frequently asked questions