Chronic illness and life insurance: what you need to know

Chronic illness and life insurance: what you need to know

When it comes to buying life insurance, a lot of people with chronic illnesses or pre-existing conditions get nervous – Is it going to be too expensive? Is the medical exam going to stop me from getting life insurance at all?

Luckily, getting life insurance with a chronic illness is not impossible. In fact, depending on your specific medical history and pre-existing conditions, you may even get cheaper rates than you initially expected. In this article, we’re going to break down exactly how life insurance companies look at your health history and which life insurance companies are best for people with a chronic illness.

Keep reading for an action plan on how to shop for life insurance with a chronic illness.

How do chronic illnesses affect my life insurance coverage?

All term life insurance companies will have you go through something called "underwriting" during your application process, which is a fancy name for looking at a bunch of charts and deciding how risky it is to insure you. A lot of factors go into this – hobbies, driving record, and, of course, your health.

Term v.s. Whole Life Insurance: watch our video breakdown

It’s easy to guess that the more health conditions you have or have had in the past, the more expensive your life insurance is going to be. But how do life insurance companies actually decide the magic number that makes up your monthly bill? Charts, mostly, and a lot of little rules.

Every life insurance company has a set of underwriting guidelines that they use to decide which health classification you fall into. There are sets of guidelines for almost everything – scuba diving, marijuana smoking, and, of course, just about every chronic illness under the sun.

Based on your specific health profile, you’ll be placed into a health classification based on those underwriting guidelines.

For reference, there are four different health classifications:

  • Preferred Plus (lowest premiums)

  • Preferred

  • Standard Plus

  • Standard (highest premiums)

Additionally, if your health history is especially complex, you may be placed in a Substandard category, which has a sliding scale of premiums based on your specific health complications.

Which chronic illnesses will affect my life insurance rates?

Some of the most common illnesses we’ve come across are Type 2 Diabetes, heart disease, and a history of cancer (or a family history of cancer). Additionally, you may be worried about how cholesterol could affect your rates, or how being overweight or HIV positive could change your health classification. All of these, depending on your severity, can affect your health classification, and therefore your life insurance rates.

The most important thing to remember is that you should always attempt to get life insurance. Don’t assume it will be too expensive! Every life insurance company has different underwriting guidelines, and some companies look more favorably on diabetes, for example, than other companies do.

(As a side note, make sure you’re looking at term life insurance, not whole. Whole life insurance costs up to four times as much as term no matter what your health profile looks like.)

We’ve actually gone through and reviewed ten of the top life insurance companies and judged, based on our experience, who are the best companies for the following diseases, pre-existing medical conditions, or health experiences:

  • Survivor/Family History of Cancer (Banner Life, Transamerica, Mutual of Omaha, Pacific Life, Lincoln)

  • Recent Weight Loss (AIG, Prudential, Lincoln)

  • Heart Attack (Banner Life, AIG, Transamerica, Mutual of Omaha, SBLI, Prudential, Protective, Pacific Life, Lincoln, MetLife)

  • Diabetes (AIG, Prudential, Lincoln)

  • Sleep Apnea (Banner Life, Mutual of Omaha, Prudential, Pacific Life, Lincoln, Metlife)

  • Former Tobacco Use (Prudential, Lincoln, Metlife)

  • High Blood Pressure (Banner Life, AIG, Transamerica, Mutual of Omaha, SBLI, Prudential, Protective, Metlife)

  • High Cholesterol (SBLI, Prudential)

For other medical conditions, your best bet to get life insurance quotes and talk to an agent about your history. An agent can help you shop around for the lowest rates and have a wide knowledge base of which companies work best for specific situations.

If you can’t get term life insurance, you should start researching simplified issue life insurance or guaranteed issue life insurance. For people with particularly complicated medical histories, these products may be more cost effective. However, always get a term life insurance quote first – it’s very possible that term life insurance is cheaper than you may initially estimate. In general, term life insurance provides the most coverage for your money; simplified issue and guaranteed issue both offer lower coverage amounts for high monthly bills.