What To Do When You Need to Buy Life Insurance When You Have Pre Existing Medical Conditions

Life Insurance

If you have a pre-existing medical condition, you might be worried about life insurance coverage. Insurance carriers prefer people with optimal health, leading a safe life. That’s because they’re less likely to apply for coverage. They also tend to avail the best deals.

But you can still apply for life insurance with pre existing condition, as per experts like Gary P. Cubeta from Insurance for Final Expense. There are, however, a few things you need to know before you get coverage. In this article, learn what you need to do when buying life insurance policies with pre-existing medical conditions.

What is Pre-existing Medical Condition?

In simple terms, a pre-existing medical condition is any health condition that a person might be suffering from before applying for insurance coverage. It is irrespective of whether they are aware or aren’t aware of the condition. For example, you might have a tumor cell growth but are diagnosed months or years after obtaining the coverage. In such cases, cancer will be considered a pre-existing condition.

Conditions like cancer, diabetes, COPD, among others, are considered pre-existing conditions. Less severe conditions like asthma, sleep apnea, acne, anxiety are also included in the list. Some insurance carriers also have pregnancy on the list.

KFF estimates that 54 million non-elderly Americans had a pre-existing condition in 2018.

Can You Be Declined for Having a Pre-existing Condition?

Post the passing of the Affordable Care Act in 2010, the US Government made it illegal for insurance carriers to deny coverage to applicants who seek health coverage. Before that, it was at the sole discretion of insurance companies to accept or reject your application.

So if you’re enrolled in a plan after 2010, then no, you cannot be declined for having a pre-existing condition. Nor can you be charged higher rates. Furthermore, they are barred from raising the rates if you develop the conditions after being enrolled.

If you are a policyholder before 2010, then you have what is known as a “grandfathered plan.” These plans may charge you higher or cancel your coverage if you develop a medical condition.

What Are Your Options If You Have Pre-existing Condition?

The cost of health insurance depends on various factors, one of which is your current health condition. When you apply for a regular term insurance policy, expect to complete a lengthy questionnaire that asks about your current and past health condition. Based on the answers, they will put you in any of the following categories:

  • Super preferred
  • Standard
  • Preferred
  • Substandard

Chris Stocker with Diabetes 365 shares with us, “if you have a chronic illness such as Diabetes, you’ll be viewed as a higher risk to an insurance company.  It’s unfortunate, but it’s simply how underwriters will view your profile.  The good news is that over time, it’s easier to obtain life insurance with diabetes.  As an example, life insurance for type 1 diabetics will be substandard rated and more expensive compared to a person with type 2 diabetes.”

But there are a few policies considered best for individuals with a pre-existing condition. If you have asthma or cancer, then you should consider applying for these policies instead.

  • Guaranteed Issue Whole Life Insurance

If you have any pre-existing condition, your best option is to apply for a guaranteed issue whole life insurance policy. These policies do not require the applicants to answer health-related questions or undergo a medical examination. Because of this, they’re also sometimes referred to as “no questions life insurance.”

Most of the applicants that apply for it are approved. They get coverage even for life-threatening conditions like three- or four-stage cancer.

But as a downside, there’s a waiting period involved for these policies. The waiting period can be several months before you are accepted. Moreover, the cost can be on the higher side too. But you’re going to get the coverage for yourself.

  • Simplified Issue Life Insurance

Simplified issue life insurance policies also have a high approval rate for people with a pre-existing condition. The difference between guaranteed and simplified issues is that there are a few health-related questions asked in a simplified issue.

So at the time of application, you’ll be given a health questionnaire. Based on the answers, you’ll be approved. The waiting time is comparatively shorter and is issued within 4-8 weeks.

If you have a minor health condition, then it’s better to opt for a simplified issue life insurance over the guaranteed issue.

  • Final Expense Insurance

Another option for people having any pre-existing conditions is a final expense insurance policy. Also known as burial insurance, it can cover your cost associated with your funeral. So when you pass away, the amount is credited to your designated family member.

But as part of the coverage, you can include other costs as well. For example, if you have a loan or mortgage, you can add the cost. And when you are no more, your family members will benefit from paying off the price. Some final expense policies offer cover up to $20,000.

Most applicants that apply for final expense insurance get approved.

When buying life insurance with a pre-existing condition, consult with a registered broker like Gary P. Cubeta from Insurance for Final Expense.