Getting Approved for Life Insurance with Poor Health
Typically, you will get the best insurance rates while you are young and healthy. This is because insurance companies identify those factors as being low risk, which allow premiums to be lower. There are many other factors that determine your premium such as: lifestyle, family history of diseases, tobacco use, weight, etc.
So, what about if you are unhealthy and/or have pre-existing conditions, can you still get approved? This is one of those “good news, bad news” type deals. The good news is that there is a good chance you can still get approved for life insurance and it’s possible to get preferred underwriting classes even if you diagnosed with cancer or other diseases. The bad news is typically, premiums will be much higher or will have very limited coverage.
The ugly truth of the matter is that insurance companies won’t sell low-priced life insurance to people with poor health. Don’t let that deter you though, because there is some leeway and steps you can take to ensure you get the best rate available to you.
First, it is important to understand that each insurance company has different standards and will weigh factors differently. This basically means that just because you are declined from one insurance company, doesn’t mean that you will be declined by all insurance companies.
Also, your rates will vary from company to company. Research what companies would be best for your conditions. For example, if you have diabetes, some insurance companies are more lenient on that and won’t raise your premium up that much. Another good example is that your height/weight ratio might be preferred class in one company’s chart, but standard class in another company’s chart. If you have questions about which company would best suit your circumstance please contact us here.
People with pre-existing conditions such as diabetes, cancer, heart disease, and high blood pressure also have options. Some insurance companies will accept people with cancer after completing treatment, but will usually need one to three years of remission. You can also get a better rate if you take the medical exam during a time where your blood pressure or other pre-existing conditions are in better control.
Likewise, if your condition is only temporary, then wait until you are back to good or normal health to take your medical exam. The timing on your exam is a key factor to getting the best rate which can save you a substantial amount of money.
Another option available is a guaranteed issue life policy. There is usually no medical exam or questionnaire and everyone within the specified age range (each company is different) is accepted. Death benefits for these policies are usually much lower (around $25,000 – $50,000) and are mainly used to cover final expenses.
They will commonly have a “waiting period” attached to them which states that for the first two years, if a non-accidental death occurs, the beneficiary will get a return of premium instead of the death benefit. After the first two years, any type of death will trigger the death benefit.
Some policies will have a graded death benefit which, for the first two years will pay back the premiums paid plus interest based off how long the policy was in force. The interest paid ranges anywhere from 10% to 30%, but remember the death benefit doesn’t kick in until after two years.
Some of the last options have prerequisites and not everyone will have available. If you have a full time job and they offer group life insurance, use that as another way to get coverage with a pre-existing condition. Insurance companies don’t require medical exams for group life insurance because the risk is spread out between all the employees.
If you have bought term life insurance in the past then you might be able to convert it to a permanent policy. This won’t increase the coverage you have (because that would require underwriting and a medical exam) but it will extend the length which may be helpful.
Overall, getting approved for life insurance is definitely a doable task even if you have poor health. It does however, come with strings attached whether it be more costly, limited coverage, or have other specified terms and conditions. You need to evaluate if those obstacles are worth getting the coverage or not. It may not be worth it to get life insurance if your premiums are sky high, through the roof. Remember though, getting quoted for a life insurance policy is free to you and sometimes getting the medical exam is worth seeing if it’s worth it. Just keep in mind that companies will check if you have been declined from other insurance carriers and it may affect your chances of being accepted, so do your research.
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