Guide to Approaching Life Insurance With Pre-Existing Conditions

Amanda Dexter
Amanda Dexter

The Importance of Life Insurance

Life insurance is an important part of sound financial planning. We all want the best for our family, and if you were to pass away, and were therefore unable to continue to support them, a life insurance policy would provide some much-needed financial security for those dependent on you. It’s an important part of estate planning — creating an overall financial plan for where your wealth and assets should go while you’re alive, as well as upon death. And even if you don’t have a family of your own, a life insurance policy can still help with settling any remaining debts you may have, as well as with funeral expenses.

However, because of the coronavirus pandemic and the economic recession, life insurance companies have raised their rates, limited coverage, and reduced benefits. And since older adults and those with pre-existing conditions have a higher death rate from COVID-19, some life insurance companies are denying coverage to people in these groups entirely. 

Life insurance is based on the relative risk that the insured will pass away during the policy term, and therefore result in a beneficiary making a claim. The higher the risk, the less likely the applicant will be approved for a life insurance policy, or, if they are approved, they are less likely to get favorable rates and policy terms. This can make getting affordable life insurance tricky for those with pre-existing conditions.  

How Pre-existing conditions affect your Life Insurance policy

A pre-existing condition is a chronic medical injury or illness that you were diagnosed with before purchasing life insurance, such as diabetes, high blood pressure, high cholesterol, heart disease, depression, asthma, cancer, and even sleep apnea. Because pre-existing conditions can affect your longevity, life insurance companies will see you as a higher risk to insure and may, therefore, deny you coverage or charge higher rates.

It’s also important for consumers to keep in mind that any results they may receive from genetic testing could also affect their ability to get life insurance. While the Genetic Information Nondiscrimination Act (GINA) protects applicants when seeking health insurance, this protection does not extend to other types of insurance, including life insurance. Therefore, some life insurance companies may incorporate genetic testing results into their risk assessment calculations when you apply.

Once a risk assessment calculation is made, the life insurance company will then apply a rating to the applicant, and if accepted, the policy offered to you will be based on these ratings. The typical ratings include: 

  • Super Preferred (or Preferred Plus): Applicants with this rating are deemed the lowest risk and will, therefore, receive the best rates for life insurance. These applicants are most likely in perfect health with a clean medical history, including immediate family members. They have no history of drug or alcohol abuse, no history of hazardous activities, and have a clean driving history. 
  • Preferred: These are often among the lowest rates you can find and are reserved for those in optimum health, but may have slightly elevated cholesterol levels, blood pressure, or weight. The premature death of an immediate family member due to cancer or cardiovascular issues may disqualify you from this rating. You also need to have a safe driving record and no recent history of smoking.
  • Standard (or Regular): Your typical American will fall under this rating. These applicants are generally in good health, but may have a larger issue, such as high blood pressure, or have an immediate family member who died prematurely (before age 60) from cancer or heart disease. This rating may include smokers, but smokers will receive higher rates. 
  • Substandard: Applicants who rate below standard are typically patients with complicated and chronic conditions, such as diabetes or heart disease, or a history of drug or alcohol abuse. These applicants may also have hazardous hobbies, like scuba diving or race car driving, or occupations, such as truck driving, roofing, or construction. These people may still receive coverage, but they are further rated depending on the severity or risk of their circumstances. 

Although disclosing a pre-existing condition to your life insurance provider may make the application process more challenging, it’s still very important to be honest about your health history. If a life insurance company eventually becomes aware that something was intentionally misrepresented or left out on your application, it may pursue it as a case of fraud. The potential consequences of not being forthright with your life insurance provider can even leave your beneficiaries empty-handed. 

However, if you have a pre-existing condition, you are not entirely out of luck. This guide provides information on how you can get life insurance even if you have a pre-existing condition, and what steps you can take if you’ve been denied life insurance coverage. 

Cancer as a Pre-existing Condition

Cancer is a pre-existing condition that is taken seriously by life insurance underwriters and makes many providers hesitant to provide coverage. In fact, men in the U.S. have a 40.1% chance of developing cancer at some point in their lives, while women have a 38.7% chance, and in 2020 there will be over 1.8 million new cancer cases in America alone. However, as screenings, therapies, and treatments improve, cancer patients are living longer, and some life insurance companies are providing more affordable coverage options for them. The most prevalent types of cancer include:

  • Lung/bronchus
  • Colorectal
  • Breast
  • Prostate
  • Non-Hodgkin lymphoma
  • Pancreas 

Cancer and life insurance

Because the risk of death increases whenever someone is diagnosed with cancer, life insurance companies see these applicants as high risk. The likelihood of receiving coverage can depend on the type of cancer and its mortality rate and life expectancy, as well as the date of diagnosis, treatment plan, and length of remission. For example, someone with stage 1 melanoma with a good prognosis and strong treatment plan is more likely to be insured than someone diagnosed with advanced stage 3 lung cancer with few treatment options available.

Some cancer patients and survivors seeking life insurance will receive a standard rating, but if your cancer has a particularly high mortality rate and short life expectancy, you’re likely to be rated substandard. The lower your rating, the more expensive coverage will be. 

As a general rule, most insurers want your cancer to have been in remission for a few years and do not cover people who are currently undergoing cancer treatment. In rare cases, some insurers may issue you a policy, but the premiums will be much higher, and coverage might be limited. 

Even if you have just been diagnosed, you still have life insurance options through guaranteed issue life insurance, also known as burial insurance. This “cancer friendly” type of whole life insurance policy is based on your age and does not require you to answer medical questions or undergo a medical exam. These guaranteed policies are much more expensive and generally pay out reduced benefits, with most paying out a maximum of $10,000. Some providers of these whole life insurance policies are Colonial Penn, TruStage, Globe Life, and AIG Direct.

Even if you have survived cancer, life insurance companies will look at the type of cancer you had, how long you’ve been in remission, and your other health history. Also, many life insurance companies have a waiting period, usually between six months to two years after purchase, before the policy would pay out any benefits. 

Again, it is essential to be upfront with life insurance companies about your medical history, including your family’s medical history. If anyone in your immediate family has a history of cancer or other chronic illness, life insurance providers may see a risk and raise your premiums. However, if you only have one relative that has been diagnosed with cancer or another pre-existing condition, or if they were diagnosed after age 65, it will probably not be a big deal to insurance underwriters. If you choose to omit a medical condition on your application, be reminded that insurance companies will gain access to all your medical records, resulting in higher premiums or complete denial of benefits.

Diabetes as a Pre-existing Condition

Diabetes is a chronic condition that affects 34.2 million Americans. According to the Centers for Disease Control and Prevention (CDC), one-third of American adults have prediabetes, and the number of diabetes cases is rising each year, especially at younger ages. However, the rising number of people with diabetes and better treatment modalities means that more life insurance companies are covering people with diabetes.

Diabetes may fall under one of three types:

  • Type 1 diabetes: Usually diagnosed in childhood, 5% to 10% of those with diabetes have Type 1 diabetes, which causes the autoimmune system to attack the body and prevents insulin from being made. This type of diabetes requires the use of insulin every day to survive.
  • Type 2 diabetes: This type of diabetes develops over many years and is usually diagnosed in adulthood. About 90% to 95% of people with diabetes have Type 2 diabetes, and may need insulin injections, pills, or lifestyle changes to manage it. 
  • Gestational diabetes: This occurs only in pregnant women who did not have diabetes prior to pregnancy. Most often, this type of diabetes disappears after giving birth.

Diabetes and life insurance

The type of diabetes you have, as well as its severity, may make getting life insurance more difficult, or cause you to pay higher rates. This is because of diabetes’ many complications and the shorter life expectancy of those diagnosed with it. However, getting life insurance with diabetes is not impossible. Most life insurance companies take into consideration the type of diabetes you have, whether or not you have any comorbid conditions as well, such as obesity or heart disease, and how well your diabetes is being controlled.

Those who have their diabetes well under control are more likely to receive life insurance coverage, as well as those with the less-severe Type 2 diabetes, which can be controlled by simple medication. The more severe or less controlled your diabetes, the less likely you will get affordable (or any) life insurance coverage. Therefore, if you are diagnosed with any type of diabetes, it is crucial that you maintain a healthy lifestyle, lose weight, take all medications, monitor your blood sugar daily, and see a doctor regularly for checkups.

Most diabetics will receive substandard or standard life insurance options and pay higher premiums. Although you have your choice of companies that will possibly provide you with coverage, the American Diabetes Association recommends life insurance through John Hancock, which offers specialty insurance just for people with diabetes. 

Cardiovascular Conditions as Pre-existing Conditions

Cardiovascular conditions refers to any disease of the heart and blood vessels, although it is often used synonymously with “heart disease.” Cardiovascular disease is the number one cause of death globally — causing one in four American deaths —and can lead to heart attack, stroke, and heart failure. The most common cardiovascular conditions include:

  • Coronary artery disease
  • Irregular heartbeats (arrhythmia)
  • Weakened heart muscles (cardiomyopathy)
  • Valvular diseases
  • Congenital heart defects

Cardiovascular conditions and life insurance

Because of the increased risk of death associated with cardiovascular conditions, life insurance providers may be reluctant to issue coverage if you or your family have a history of cardiovascular problems. Heart problems are often hereditary, so providers will typically ask if anyone in your immediate family has experienced heart problems before a certain age, or if any conditions resulted in death. How much a life insurance underwriter will be concerned with your family history varies widely from company to company, but it may result in higher rates or even denial. 

Underwriters will also look at the recency and severity of any heart problems you may have experienced. Younger people with congenital heart defects should be able to get life insurance with no problem, although they may have to pay a slightly higher rate, but coverage for anyone with a serious heart condition will be much more costly. For example, those with arrhythmias can expect to pay less than someone who has had atrial fibrillation or heart bypass surgery. Many people with a heart condition will be rated as substandard or standard when it comes to life insurance policies.

Life insurance companies will not only judge the severity of your disease, surgery, or injury, but they will also look at many other factors that commonly worsen or exacerbate cardiovascular conditions such as: 

  • Level of heart damage
  • Obesity
  • Anxiety
  • Substance abuse (including smoking)
  • Previous surgeries
  • Other lifestyle factors, including activity level, occupation, and stress

If you have a cardiovascular condition, life insurance companies are more likely to offer you coverage if you are taking your medications and making the necessary lifestyle changes. They will consider what steps you are taking to improve your overall health, such as monitoring and controlling your blood pressure and cholesterol levels, eating a healthy diet, and exercising regularly. If you’ve been denied coverage previously, showing improvement over a period of time will go a long way with persuading life insurance providers to insure you.

Most people with cardiovascular disease will be given a standard rating for life insurance policies. This ultimately means a higher premium and possibly limited coverage.

When it comes to plan selection, competitive pricing, and customer service, the most cardiovascular disease-friendly life insurance companies are Protective, AIG, and Foresters. 

What to Do If You Are Denied

If you apply for life insurance and are denied, here are some steps you can take:

  • Learn why. Insurers must provide you with the reason(s) why you were denied, whether it was because of your medical history, medical exam, driving record, lifestyle factors, or something else. If you receive a letter of denial, contact your agent or follow the directions to contact the company itself. Request that they send a written copy detailing the reasons for your denial and any information about filing an appeal.
  • Verify the information. Make sure the information on your medical record used to deny you is accurate. Errors do occur, and sometimes patients are denied life insurance for errors or misunderstandings. You can have your medical record from the Medical Information Bureau sent to your doctor’s office so you and your doctor can go through it. 
  • Check for group coverage. Group term life insurance coverage through an employer is a single life insurance contract that covers an entire group of people, rather than an individual person. Although they may not have the payouts you’re hoping for, group coverage life insurance policies do not require medical exams and are typically not subject to denial because of an individual’s pre-existing condition(s). If employment ends, you may be able to transfer the policy to an individual policy, although you will be responsible for the (typically higher) premiums.
  • Check your timing. Recent surgeries or illnesses, as well as a recent history of smoking, can cause you to be denied coverage because you have not yet demonstrated improvement in your health. You may want to delay application until your condition is better controlled or less severe. The longer you can show that you have been actively managing your health and any existing conditions, the more willing insurers may be to cover you. Take the time to improve your health, with things like exercise, diet, quitting smoking, and getting regular checkups, to show insurance companies that you are dedicated to improving your health.
  • Consider working with an independent agent. Even if you have been denied coverage, you should seek out the help of an independent agent. Agents are familiar with the underwriting process and may provide insight into why you have been denied and how to best present your case to get approved. They will also know about the options or types of coverage available to you from numerous providers. They are able to take your personal circumstances into consideration while comparing multiple options to find you the most competitive rates and coverage, saving you the hassle of shopping around for the right provider.  

The Bottom Line

When applying for life insurance, it is important that you are honest and upfront about your medical history. Once providers and agents have this information, they can then research to find the best life insurance options for you.

It is also important to show life insurance providers that you are dedicated to improving your health and lifestyle through efforts like eating a healthy diet, exercising, lowering your cholesterol, and visiting the doctor regularly. The life insurance underwriting process is all about risk assessment, so you need to do everything you can to demonstrate that you’re doing what is necessary to reduce that risk.

Keep in mind there are many different life insurance providers and plans that may be a fit for you, even if you have a pre-existing condition. The key is to research as many options as possible to ensure you find the best provider and coverage for your needs.

About the Authors

Amanda Dexter is an educator-turned-freelance writer who specializes in producing high-quality, research-based long-form content for the medical/healthcare, travel, and education sectors. She holds an M.A. in Teaching from Missouri State University and is also a Certified Nursing Assistant (CNA).