Life insurance for disabled individuals

If you have a disability, your life insurance needs are likely to be no different to anyone else that wants to make sure their loved ones have a safety net after they die.

Happily, for the 14 million people in the UK with a disability, it rarely stops you from accessing a full range of life insurance types – though you may have to pay a bit more for your policy.

In this guide, we’ve answered some of the most common questions about life insurance and disabilities, plus given our tips for keeping costs down.

Can you get life insurance if you have a disability?

Yes. Disability legislation in the UK means that insurance companies can’t refuse to insure you, or offer you worse terms than people without disabilities, simply because you are disabled.

However, if your disability means you are more likely to make a claim, insurers are allowed to charge higher premiums or apply special conditions.

In rare circumstances, insurers may refuse an application for life insurance if they can prove that your disability could significantly affect your life expectancy.

Does life insurance pay out for disabled people?

Provided that the cause of death is covered by the life insurance policy, life insurance will pay out for disabled people in the same way as it does for people without disabilities.

This applies whether you had the disability at the time of taking out the policy (provided you told your insurer about it as part of your application) or whether you become disabled after taking out the policy.

How does the severity of a disability affect life insurance?

Some disabilities will have a minimal impact on your life expectancy and ability to live an active life; more severe disabilities may have a major impact on your life expectancy.

Life insurers will consider the risk of your disability on life expectancy as part of your application and will use this to help decide whether to offer you cover and how much to charge.

Do I need to tell a life insurer about my disability when I apply?

It’s essential that you answer questions about health conditions, including any disabilities, honestly as part of your application for life insurance.

If you lie or withhold information, you run the risk of any payout being reduced or your policy being rendered invalid, particularly if the cause of death is linked to an undisclosed disability.

Does life insurance cover long-term disability?

Life insurance provides a payout when the policyholder dies. It will not pay out if you become permanently disabled after taking out the policy.

However, if your death is the result of your disability, and this is covered as part of your policy, then a life insurance policy will pay out.

If you don’t currently have a disability, but would like to receive a payment in the event that you become permanently disabled, consider critical illness cover. This can be bought as an add-on to life insurance or a standalone policy.

Is life insurance more expensive if I have a disability?

It depends on the nature of the disability and how much it affects your likelihood of making a claim.

If your disability has no bearing on your life expectancy and the likelihood of making a claim, all else being equal you should pay no more for life insurance than someone without a disability.

If your disability could affect your life expectancy, how much more you’ll pay will depend on the severity of your condition and the insurer’s underwriting criteria. Some may apply a higher premium than others for the same disability.

How can disabled people get affordable insurance?

The key thing is to shop around. Underwriting processes can vary significantly between life insurance providers, and so can the premiums they charge.

As with anyone applying for life insurance, you can also keep costs down by managing other risk factors that tend to bump up premiums, for example:

• If you are overweight, reduce your BMI to recommended levels.
• Give up smoking. Smoking typically doubles how much you’ll pay for life insurance, as we explain in our guide to life insurance and smoking.

If you struggle to find affordable insurance by getting quotes directly from providers, consider using a specialist broker to research the market for you. Alternatively you could try contacting any charities that support people with your kind of disability.

Types of life insurance for disabled people

Just because you have a disability, it doesn’t mean your life insurance needs will be any different from those of people without disabilities.

Fortunately, disabled people should be able to access all of the same types of life insurance as those without disabilities. Take a look at our guides to life insurance to help decide which type is best for you and your family.

Best life insurance for disabled people

Whether you’re disabled or not, the best life insurance will depend on your personal situation and why you are taking out life insurance.

If your disability is such that it is pushing up premiums for traditional life insurance more than you can afford, you could consider:

• If you’re aged 50 or over, there are over-50s life insurance plans that don’t require any medical screening. However, payouts are usually much lower than with standard life insurance policies, so they may not be enough to meet your beneficiaries’ financial needs.
• If you can’t find, or afford, a life insurance policy that covers causes of death related to your disability, you may be able to get affordable cover for a policy that excludes your disability. If you want to consider this option, read any small print carefully before buying so that you are clear what causes of death might be regarded as linked to your disability.

Life insurance vs disability insurance

Life insurance provides a payout to your loved ones in the event of your death. It doesn’t cover you if you become disabled and are unable to work.

Disability insurance, on the other hand, protects you from loss of income if you can’t work for an extended period due to illness or injury. It is also known as income protection insurance.

Which type of insurance you should buy will depend on your circumstances and the potential needs of your family. Some people may choose to buy both life insurance and disability insurance.

Equality Act 2010: How it affects life insurance

The Equality Act 2010 legally protects people, including disabled people, from discrimination in the workplace and in wider society.

Under the Equality Act, insurance companies must not refuse to insure you or offer you worse terms just because you are disabled.

However, they are not prohibited from charging higher premiums or applying special conditions if they can show that your disability increases your risk of making a claim.

The Equality Action 2010 does not apply in Northern Ireland, but it has its own laws that prevent disability discrimination, as explained here.

Bottom line

Having a disability shouldn’t prevent you from taking out life insurance or affect the types of life insurance that are available to you.

If your disability is likely to have an effect on your life expectancy, you may need to pay more for the same level of cover than someone without that disability.

Shopping around for life insurance and managing the other risk factors that affect how much you’ll pay, such as whether or not you smoke, are the best ways to keep the cost of life insurance down.

Frequently asked questions

• What is the best time to buy life insurance with a disability?

  Typically, the earlier in life you take out a life insurance policy, the lower your premiums will be. This applies whether you have a disability or not.

  Depending on the nature of your disability, taking out a policy earlier in life also means you may be less likely to have developed serious side effects related to your disability that could affect the price you will pay.

• Do I need to tell my life insurer if I become disabled after taking out my policy?

  Check the terms and conditions of your policy – some providers make it a condition of cover that you inform them of any changes to your health. However, your cover and premiums are set at the point you take out your policy, so how much you pay and the terms of existing cover won’t be affected.

• What is considered a disability?

  Under the Equality Act 2010, you’re considered disabled if you have a physical or mental impairment that has a “substantial” and “long-term” negative effect on your ability to do normal daily activities.

  The word “disability” can cover many different conditions, including (though not limited to):

  • Neurological impairments that affect your brain, such as epilepsy and Parkinson’s disease.
  • Hearing impairments, which can result in full or partial hearing loss.
  • Visual impairments, a term used to describe full or partial sight loss.
  • Cognitive impairments, which can affect your ability to remember things, concentrate or learn new things, such as Alzheimer’s disease or Huntington’s disease.
  • Musculoskeletal disorders, which affect the muscles, nerves or joints, such as arthritis or problems caused by spinal cord injury.