How to buy life insurance with pre-existing medical conditions

Being ill can put life into sharp focus, making you realise you want to take care of your loved ones when you’re gone. While it will be harder and potentially more pricey, it is still possible to buy a policy if you are sick or have a pre-existing medical condition.

If you do your homework, you should be able to find insurance that will give you and those you care about peace of mind. However, the size of the financial safety-net you leave behind will depend on a whole host of factors.

How do I get life insurance when I’m ill?

Being ill doesn’t necessarily mean you’ll be disqualified from taking out a standard life insurance policy. Before applying, work out your budget and your needs. Do you want financial help for your partner when you’re gone, for example? Or simply a policy to cover funeral costs?

Here are some other essential tips for the search process:

• Talk to an insurance broker. While comparison websites are a good starting point, insurance brokers can offer expert advice and help you work out your ideal life insurance policy. They’ll go over your needs, your budget and then offer suggestions.
• Consider over-50s insurance. If you’re over 50 and a pre-existing medical condition is stopping you from taking out life insurance, over-50s policies won’t require you to undergo any exam – or even answer any questions about your health. The downside? Any payout will be much smaller.
• Be completely upfront. It might be tempting to leave out some details about your or your family’s medical history to get cheaper rates. However, if your insurer finds out you lied in any way it might invalidate your insurance and refuse to pay out to your beneficiaries.
• Keep your insurer in the loop. Listen to your doctor’s orders and stay in touch with your insurance provider. You might be able to request a new medical screening after a few months or a year if you look like you’re on the road to recovery or showing promising signs of remission.
• Speak to charities. If you’ve suffered from a serious illness like cancer, there are charities with specialist advice helplines who can offer you tips for finding affordable life insurance.
• Find a support group. You may already be part of a support group, a space where you can give and receive emotional support, and speak about the practical challenges you face too. Someone might be able to give you advice about finding life insurance.
• Shop around. While one provider might reject you because of your illness, another might decide you’re not too high-risk.
• Wait a while, if possible. If you’re receiving treatment for a curable disease or there’s an end in sight with your illness, you might want to just wait. Some insurers will provide better rates as soon as your doctor says you’re back to a full bill of health.

My illness is terminal. What are my options?

Over-50s policy

If your illness is terminal, finding a life insurance provider to cover you will be more difficult. You could look at an over-50s policy, which you won’t have to do any sort of medical screening for. Here are the main features of this type of deal:

• No medical screening. You won’t have to answer any questions about your health, which makes policies like these accessible to anyone.
• Age. These policies are typically available to people aged between 50 and 80.
• Funeral benefit. You can often get help paying your funeral costs with these types of deals.
• Guaranteed payout. So long as you keep paying your annual or monthly premiums, the insurer will definitely pay a lump sum to your beneficiaries when you die.
• Exclusions. It’s essential you watch out for exclusions! Your family might not get a payout if you die within the first year or two of taking out the policy.
• Lower payouts. While accessible, these policies have relatively low limits on how much they will pay out upon your death.

Pre-paid funeral cover

If your main concern is helping your loved ones pay for any funeral costs, you could take out pre-paid funeral cover. With this type of policy you pay in advance for your funeral, either in a one-off cash sum or in monthly instalments.

This money is then invested into a trust fund or an insurance plan, which then takes care of certain funeral costs – whenever it happens to be.

Be wary though; funeral cover often doesn’t pay for everything involved with the event. The cost of a burial plot is rarely included, likewise funeral director fees, and fees for services such as flowers or catering, are usually left out too.

How can my illness affect my rates?

When you apply for any type of insurance, a provider will look at your personal, financial and medical details to work out your level of risk. If you’ve had a serious illness it can really push your rates up. Here are a few ways it could go:

Reduced rates for months or years after. If you can prove that you’re on the road to recovery or you can keep your condition under control, the insurer may bring your rates down.

Expensive premium costs. An insurer may agree to offer you life insurance but only at sky-high prices, on the basis that your illness makes you a high-risk customer.

Refuse coverage. People with certain illnesses or conditions, or ones that can’t be cured, won’t be able to get a standard life insurance policy.

Exclude your condition. In very rare cases you can get life insurance that will cover you but will exclude your past illness or pre-existing health condition. A policy like this will hardly offer any peace of mind though.

Which health conditions affect my rates?

Insurance companies won’t classify every health condition as high risk, meanwhile insurance companies won’t all have the exact same risk assessment process.

This means while one provider might refuse to cover you due to your illness, another might decide your medical history isn’t an issue. If you’re able to keep your condition under control, you have a much better chance of lowering your rates.

Unfortunately, having a terminal illness will mean you probably won’t get a standard life insurance policy anywhere. As a guide, here are some common conditions and illnesses that can affect life insurance costs:

• Cancer. Whether you can get a standard life insurance policy will depend on your type of cancer and the stage of treatment. In general, those battling cancer and survivors will find it difficult to get affordable coverage. You may have to be in remission for two or three years before you see rates drop.
• Heart conditions. An insurer might reject your application, hike your prices or offer you a standard life insurance deal. It all depends on the severity of your condition.
• High blood pressure or cholesterol. While this is a common condition, insurance companies use it as a major factor when working out your rates, as high blood pressure can generally lead to more serious health concerns.
• Obesity and weight-related conditions. Being heavily overweight can lead to higher premiums as it can cause you to develop health problems and serious conditions.
• Diabetes. Insurers may reject your application or hike your prices as this condition can lead to life-threatening complications.
• Organ transplants. Providers may offer you an affordable deal if you have recovered from an organ transplant and there have been no complications. They may well reject your application outright too.
• Mental health conditions. This is a sensitive issue, but life insurance providers have been known to reject applications from people who have suffered from depression and anxiety. Meanwhile, conditions like dementia will almost certainly make finding insurance difficult.
• Smoking. Quit smoking and you could see premiums drastically reduce after going 12 months tobacco- and nicotine-free.
• Sleep apnea. This condition can impact on your sleep and can also increase your risk of developing other health conditions, so insurers may hike your prices here too.

Even if you think you’re unlikely to succeed, it’s worth applying with a few insurers anyway. In fact, if you can demonstrate that you’re doing all you can to manage your condition, and your treatment is going well, an insurer may offer you a reasonable deal.

Bottom line

Whatever your condition, the first step you need to take is working out why you want life insurance. What do you need coverage for? Is it to look after your partner when you’re gone, to pay off a mortgage or take care of funeral costs?

Then you need to budget, working out what you are willing to pay on premiums. If you won’t be able to keep up the payments there’s not much point in starting a policy.

After this, you should at the very least apply for a standard life insurance policy. You might be rejected, but you can increase your chances by speaking to insurance brokers, charities and people you know from support groups.

They might be able to offer advice about keeping your insurance costs down, while also being totally honest about your condition. Ultimately, you could turn to an over-50s policy or a funeral plan if you’re really struggling to get accepted anywhere.

Frequently asked questions

• What can I expect with life insurance medical exams and questionnaires?

  Each provider will have its own way of doing medical exams and screening.

  With most policies you’ll have to fill out a questionnaire when you sign up, which will include questions about your and your family’s medical record.

  If there are any issues, the insurer will contact your GP and ask for details about your health and medical history. The provider may also ask you to undergo a medical exam, which will consist of a full health checkup, including taking blood and urine samples for testing and an interview with a nurse.

  Each provider deals with medical exams and questionnaires a bit differently. A medical exam is typically a full health workup, including blood and urine samples and an interview with a nurse.

• How long do I have to wait to receive life insurance money?

  When a loved one dies it can be an incredibly traumatic time, but with life insurance, it doesn’t have to be financially stressful too. Yet bills can start coming in quickly – whether it’s for funeral costs or the monthly rent.

  If you’re a listed beneficiary on a life insurance policy you can get help, and you should get a payout from anywhere between a few days and a month of filing your claim.

  However, there can be delays. Sometimes the insurer will want to investigate or will need further documentation before it can make a decision.

  If the policy holder dies from lung cancer and they were listed as a non-smoker, for instance, the insurer will want to thoroughly check all information before paying out.