Cancer And Term Life Insurance: What Coverage Is Offered?

Cancer is emotionally and financially taxing for patients and their families. Life insurance can help cover the costs of treatment, pay off debts, and provide financial support for families after the patient's death. But does term life insurance cover cancer?

Life insurance for cancer patients: options and costs

A cancer diagnosis can be emotionally and financially challenging, and life insurance can provide valuable support for patients and their families. While it may be difficult to obtain life insurance after a cancer diagnosis, it is not impossible, and there are several options available.

Options for Cancer Patients:

If you are a cancer patient, your life insurance options may include:

• Guaranteed issue life insurance: This type of policy does not require a medical exam or health questions, and you cannot be rejected based on pre-existing conditions. However, coverage amounts are typically low, and premiums are high.
• Simplified issue life insurance: This option does not require a medical exam, but you may need to fill out a health questionnaire. It is suitable for those who are cancer-free but not in perfect health.
• Group life insurance: You may be able to access group life insurance through your employer, which can come in the form of guaranteed issue without a medical exam or health questions. However, coverage amounts may be limited, and you may lose the policy if you leave your job.
• Final expense/burial life insurance: This type of insurance is designed to cover end-of-life expenses such as funeral costs and medical bills. It is easier to qualify for this type of insurance, making it an option for those with pre-existing conditions.
• Traditional term and whole life insurance: These policies are typically for individuals in good health, and obtaining them with an active cancer diagnosis can be challenging and expensive. However, once you are in remission, your chances of securing affordable coverage improve.

Costs for Cancer Patients:

The cost of life insurance for cancer patients can vary depending on several factors, including:

• Type and stage of cancer: Insurers classify cancers based on their risk, taking into account the aggressiveness of the cancer and the severity of the disease.
• Treatment history: The type and duration of treatment, as well as the response to treatment, will be considered by insurers.
• Time since diagnosis: The duration of remission is a critical factor. The longer you have been cancer-free, the better your chances of securing affordable coverage. Some insurers require a minimum of five years in remission before offering traditional life insurance.
• Age and overall health: Your age and other health factors can impact your options and premiums.
• Prognosis and survival rate: Insurers consider statistical data on survival rates and long-term outcomes for different types of cancer.
• Specific cancer factors: Certain cancers have specific measures, such as the Gleason score for prostate cancer, which will be taken into account.

While life insurance for cancer patients can be more costly and challenging to obtain, it is important to know that options are available. By considering the various types of policies and factors that affect costs, cancer patients can find the coverage they need to provide financial security for themselves and their loved ones.

Life insurance for cancer survivors

If you are a cancer survivor, you may find it challenging to obtain a new life insurance policy. However, it is not impossible, and there are several options available to you. Here is some essential information to help you navigate life insurance as a cancer survivor.

Types of Life Insurance Policies for Cancer Survivors

Guaranteed Issue Life Insurance

Guaranteed issue life insurance plans do not require a medical exam or health questions, and you cannot be rejected as long as you fall within the eligible age range. However, these plans typically have lower coverage amounts and higher premiums. The maximum coverage amount is usually $25,000, and if you pass away within the first two or three years of purchasing the policy, your beneficiaries may not receive the full death benefit payout.

Simplified Issue Life Insurance

Simplified issue life insurance does not require a medical exam, but it does include a few health-related questions in the application. It offers quick approval and a lower death benefit than traditional policies.

Final Expense Insurance

Final expense insurance, also known as burial or funeral insurance, is designed to cover funeral costs and end-of-life expenses. Some final expense plans include health questions, while others are guaranteed issue plans without health requirements.

Group Life Insurance

Group life insurance is often offered by employers and requires minimal or no contribution from employees. However, the coverage amounts are usually limited and based on your salary, and you will lose the coverage if you leave your job.

Factors Affecting the Cost and Availability of Life Insurance for Cancer Survivors

Several factors can impact the cost and availability of life insurance for cancer survivors:

• Type and stage of cancer: Insurers classify cancers based on their aggressiveness and severity, and the risk they pose.
• Treatment history: The type and duration of treatment, such as chemotherapy, radiation, surgery, or immunotherapy, and the cancer's response to treatment, will be considered.
• Diagnosis duration: The length of time since diagnosis and remission status will affect eligibility and premium rates. The longer you have been in remission, the better your chances of obtaining traditional life insurance at more affordable rates.
• Prognosis and survival rate: Insurers will consider statistical data on survival rates and long-term outcomes for specific cancer types.
• Specific cancer factors: Certain cancers, such as prostate cancer, have specific measures, like the Gleason score, which will be taken into account.
• Other factors: Age, overall health, family medical history, and tobacco usage will also be considered when determining risk and rates.

Important Considerations

• Disclosure: It is essential to disclose your cancer history when applying for life insurance. Non-disclosure is against the law and may result in your beneficiaries being denied the death benefit payout.
• Waiting periods: Different types of cancer may have specific waiting periods before you can qualify for life insurance. For example, the waiting period for skin cancer or prostate cancer may be less than five years.
• Cost: Life insurance for cancer survivors can be more expensive due to the higher financial risk to the insurer.
• Shop around: Each insurance company has its own qualifiers and rates, so it is advisable to compare quotes and explore your options before choosing a policy.
• Existing life insurance policy: If you already have a life insurance policy and are diagnosed with cancer, your policy should be honoured as long as you were honest about your medical history when taking it out.

While life insurance for cancer survivors may be more challenging to obtain and may come with higher costs, there are options available. It is important to be honest about your medical history, shop around for the best rates and coverage, and consider the various types of policies available to find the one that suits your needs.

Cancer insurance vs. life insurance

Cancer insurance and life insurance are two different types of insurance policies that offer financial protection in the event of a cancer diagnosis or death. Here are the key differences between the two:

Cancer Insurance

Cancer insurance is a supplemental insurance policy that is designed to cover the costs associated with cancer treatment. It can help cover expenses that may not be fully covered by primary health insurance, such as deductibles, copayments, and out-of-pocket costs related to chemotherapy, radiation therapy, and surgery. Cancer insurance policies typically cover all types of cancer at all stages, including pre-stage, early-stage, and major-stage. This type of insurance can be used as a regular income plan to offset lost income during cancer treatment.

Life Insurance

Life insurance, on the other hand, is a more comprehensive type of insurance that provides financial protection for your loved ones in the event of your death. It is typically purchased to cover expenses such as mortgages, debts, and providing income for dependents. Life insurance policies can be further categorized into term life insurance and whole life insurance. Term life insurance lasts for a certain period, such as 10 or 20 years, while whole life insurance offers lifelong coverage. Obtaining life insurance after a cancer diagnosis can be difficult, and premiums may be higher. Life insurance companies will consider factors such as the type and stage of cancer, treatment history, diagnosis duration, and prognosis when determining eligibility and premiums.

Both cancer insurance and life insurance can provide valuable financial protection, but they serve different purposes. If you are concerned about the financial burden of cancer treatment, cancer insurance can be a good option to supplement your health insurance. On the other hand, if you want to ensure your loved ones are provided for in the event of your death, life insurance is the more appropriate choice. It's important to carefully review the details of any insurance policy before purchasing it and to seek advice from a financial advisor to ensure you make the right choice for your specific needs and circumstances.

Getting life insurance after a cancer diagnosis

If you have been diagnosed with cancer, you may be wondering what it might be like to obtain life insurance. The good news is that many life insurance companies are happy to insure cancer patients and survivors. However, it is important to note that premiums and coverage specifics will differ from case to case and cancer patients are considered higher risk, so a life insurance policy may be more expensive.

Types of life insurance for cancer patients

• Guaranteed issue life insurance is typically available to individuals regardless of their health status, meaning you may still get approved if you have cancer. These policies usually have no medical exam, lower coverage amounts, and higher premiums.
• Simplified issue life insurance doesn't require a medical exam, but includes a few health-related questions in the application. It offers quick approval and generally has a lower death benefit than traditional life insurance policies.
• Final expense insurance is a small permanent policy that can help cover end-of-life expenses such as funeral costs and medical bills. You typically won't need to take a medical exam, and can receive a lower coverage amount.
• Group life insurance is offered by some employers and requires minimal or no contribution from employees toward the premium. However, these plans usually offer limited coverage amounts based on your salary, and you cannot keep your coverage if you leave your job.

Factors affecting the cost of life insurance for cancer patients

When determining the cost of life insurance for cancer patients, insurers consider a range of factors that directly impact the monthly premium and eligibility for coverage:

• Type of cancer and stage: Insurers classify cancers by the risk they pose, which is based on how aggressive the cancer is and the severity of the disease at the time of coverage.
• Treatment history: Chemotherapy, radiation treatment, surgery and immunotherapy have different durations, and cancers respond to them differently. Positive responses to treatment may result in lower premiums.
• Diagnosis duration: The longer someone has been in remission, the better their chances of approval for medically underwritten policies and the lower their premiums may be.
• Prognosis and survival rate: Insurers weigh statistical data about survival rates and long-term outcomes for different types of cancer.
• Specific factors: Factors isolated to particular types of cancer, such as a Gleason score for individuals with prostate cancer, will also impact costs and eligibility.
• Other factors: In addition to a general cancer diagnosis, insurers also consider age, overall health, family medical history and tobacco usage when assessing the risk and determining an offer.

What to do if you already have life insurance and are diagnosed with cancer

If you already have a life insurance policy and are diagnosed with cancer, your policy should be honoured as normal, as long as you were honest about your medical history when you took the policy out. You might find it difficult to increase the value of your policy for some years, but it's important to keep it up as it will be easier than starting a new life insurance policy after your cancer diagnosis.

Life insurance for people with a family history of cancer

If you have a family history of cancer, it is important to note that this may affect your life insurance rates. While it is not always the case, some insurance companies may consider you a higher insurance risk if your parents have had cancer or if you are the same sex as a family member who had sex-specific cancer, like testicular cancer. However, other insurers might not see you as a higher risk if your family member survived cancer before the age of 60 or 65, or if they were diagnosed above the age of 65. Additionally, if you are 65 or 70 years old, many insurers will not consider family history as part of your application process at all.

When it comes to the best type of life insurance for those with a family history of cancer, there is no one-size-fits-all answer. The best policy for you will depend on your unique needs and circumstances. However, term life insurance is the most popular option for people looking to protect their income and provide their family with a financial safety net. It is also more affordable than other options like whole life insurance.

If you are specifically concerned about the impact of a family history of cancer on your life insurance rates, Lincoln Financial is a good option to consider. They do not factor family cancer history into their rate calculations, so you can still get their best rates even if you have a parent or sibling with a history of cancer.

It is worth noting that life insurance companies take a holistic view of your health during the application process. They will consider not only your family history but also your current health, age, overall health, and tobacco usage. Working with an independent and experienced life insurance agent can help you navigate the process and find the best policy for your needs.

Frequently asked questions