Getting life insurance with pre-existing conditions in Canada may seem challenging, but it is not impossible. If you’re a Canadian dealing with health conditions like diabetes, high blood pressure, or obesity, you can still get life insurance at competitive rates.
Even if you’ve been denied coverage before or considered high-risk and hard to insure, there are still life insurance options available at reasonable prices, no matter how severe your health condition is.
In this blog post, we’ll cover everything you need to know about buying life insurance for individuals with pre-existing conditions who are considered high-risk or hard to insure.
Can I Buy Life Insurance If I Have a Pre-existing Condition?
Absolutely, you can buy life insurance policies in Canada even if you have pre-existing conditions. Canadian insurance companies provide options for individuals with pre-existing conditions, even those considered high-risk or difficult to insure.
You may be eligible to purchase life insurance if you have pre-existing conditions such as asthma, cancer, diabetes, heart disease, or even an HIV infection.
It’s important to understand that health problems are a significant factor for insurance providers. While medical advancements have increased life expectancy, your current health still plays a crucial role in acquiring life insurance policies.
In Canada, some insurance companies assess your eligibility for life insurance based on your past healthcare history and family medical background. They may require a medical examination and a health questionnaire to determine the type of policy and premiums they can offer you.
The good news is that in Canada, only 4% of individuals who apply for life insurance policies are declined. This means you still have a strong chance of obtaining a suitable life insurance policy.
To navigate this process successfully, it’s advisable to consult with a knowledgeable insurance advisor. They can steer you toward specialised companies and policies tailored to your specific situation. Some insurers are more accommodating and specialise in offering life insurance to individuals with pre-existing conditions.
However, it’s essential to be aware that when you purchase life insurance with pre-existing conditions, your premiums are likely to be higher than those of individuals of the same gender and age without medical conditions. Some insurance companies may also provide modified policies or policies with exclusions for certain health conditions.
Additionally, keep in mind that each insurance company evaluates applicants differently. Most will likely ask more detailed medical questions about your health condition and may request a more extensive underwriting process if you disclose your health status.
What Are The Types Of Life Insurance For Pre-existing Conditions?
If you’re seeking life insurance but are concerned about being disqualified due to your health condition, there are several life insurance options tailored to individuals with pre-existing conditions in Canada. Companies like Manulife, for example, offer these insurance products to cater to your needs.
1. Guaranteed Life Insurance
Guaranteed life insurance is an excellent choice for individuals with pre-existing conditions. You can qualify for this policy regardless of your medical history.
This option is available for those who do not meet the criteria for traditional life insurance policies. The application process does not involve a medical exam or health questionnaire to ensure approval.
However, it’s important to note that the premiums for guaranteed life insurance are higher than those for other policies, and it typically offers a smaller death benefit, usually ranging from $25,000 to $50,000.
2. Simplified or No-Medical Life Insurance
Simplified life insurance is another valuable option for individuals with pre-existing conditions. It replaces a medical exam with a brief medical questionnaire, which is less comprehensive than traditional underwriting.
The questionnaire helps assess your health risk level, and this type of policy often provides a higher coverage amount, up to $500,000.
People with pre-existing conditions find this policy easier to apply to than traditional life insurance. However, be aware that your policy may be ‘rated,’ resulting in adjusted premiums.
3. Permanent Life Insurance
Canadians with minor and well-managed pre-existing conditions may qualify for permanent life insurance. This type of policy provides coverage until the insured individual’s death.
Some permanent life insurance policies include a savings component, which pays out a death benefit to your beneficiary upon your death.
Remember that premiums for permanent life insurance are typically higher, and your policy may be ‘rated.’ This option is best suited for those with minor conditions like high cholesterol.
4. Term Life Insurance
Term life insurance is a cost-effective alternative to permanent life insurance. It offers protection for a specific number of years and pays out a death benefit to your beneficiary if you pass away within the term.
If you outlive the term, you won’t receive any payout but can renew the policy for another term. Individuals with less severe pre-existing conditions may qualify for term life insurance but should expect higher premiums and a ‘rated’ policy.
Different Types of Pre-existing Conditions
The type and severity of your pre-existing condition play a crucial role in determining your eligibility for life insurance coverage. Below, we outline different health conditions that can affect your premiums or potentially lead to denial by insurance companies.
- Diabetes: Individuals with diabetes may still secure approval for life insurance, especially if they maintain a healthy weight, have no kidney damage, or aren’t reliant on insulin. Even if you require insulin and don’t have severe diabetes-related complications, you can qualify for a policy, albeit at a higher premium rate.
- High Blood Pressure: Severe elevations in blood pressure readings are the primary concern when it comes to disqualification. If you have moderately high blood pressure that is effectively managed, you may be approved with reasonable premiums. High blood pressure is often associated with serious conditions like stroke and heart attack, which some insurers take into account. Nevertheless, keeping your blood pressure controlled for a year can reduce premiums.
- Cancer: Despite significant cancer diagnosis and treatment advancements, life insurance companies still view cancer as a substantial risk. However, you can obtain coverage if you have a highly treatable form of cancer and have been in complete remission for two years or more.
- HIV/AIDS: Certain insurance companies extend policies to Canadians living with HIV/AIDS who have successfully managed the illness for 3-5 years and can lead their daily lives while effectively controlling the virus with medications. In such cases, you may qualify for a simplified life insurance policy.
Understanding how insurers assess these different pre-existing conditions can help you navigate the life insurance application process more effectively and secure the coverage you need.
How to Apply For Life Insurance For Pre-existing Conditions
When applying for life insurance with pre-existing conditions, it’s crucial to follow a few key steps to ensure you get the coverage you need at a reasonable rate:
- Apply When You’re Healthy and Young: The best time to apply for a life insurance policy is when you are in good health and your pre-existing condition is well managed, ideally with a stable condition for at least two years. Age also matters; the older you get, the higher the likelihood of developing complications or additional conditions that may make it harder to secure coverage.
- Honesty Is Key: Being entirely honest with your insurers is essential. Falsifying information on your application, even if it leads to approval, can result in your policy not paying out any death benefit. When you purchase a life insurance policy, you invest in your family’s financial security, so providing accurate information is crucial.
- Shop Around for the Best Deal: Life insurance rates can vary significantly between providers. This is especially important if you have pre-existing health issues or a critical illness. Each insurer has its own way of evaluating medical conditions during the underwriting process. For instance, some may offer more favourable rates to applicants with diabetes, while others may provide better terms to those with a family history of heart disease. To find the best policy based on your health history, comparing quotes from multiple insurers is wise.
- Buy Sooner Rather Than Later: While getting older may come with certain benefits, securing a lower insurance rate isn’t one of them. As you age, the likelihood of purchasing a policy at a higher cost increases because the risk of mortality rises. This is particularly pertinent if you have a pre-existing condition since your condition may worsen with age. Buying coverage early, while you’re younger and in better health, can lock in a more affordable rate.
- Manage Your Health Condition and Reapply: Even if you initially face high premiums due to your pre-existing condition, don’t assume it’s permanent. Many individuals can control risk factors for chronic diseases through lifestyle changes like improved diet, exercise, and moderation of alcohol consumption. Insurers often encourage policyholders to get healthier because it reduces their potential payout. Some insurers may allow you to undergo reassessment within a year or two of purchasing your policy. If you’ve made significant improvements in managing your condition, they might lower your premiums for the remainder of your policy term. This also applies to smokers; if you can demonstrate that you’ve quit smoking for at least 12 months, you may be eligible for reduced monthly premiums, saving you money while promoting a healthier lifestyle.
What to Do if You’ve Been Denied Life Insurance Due to Pre-existing Conditions
Having a severe pre-existing condition can sometimes make it challenging to secure life insurance. However, don’t despair; you can take steps to address this situation.
- Reallocate Your Funds: Instead of spending money on life insurance premiums, consider redirecting those funds into another financial avenue. For instance, if you intend to use insurance to cover end-of-life expenses, you can create a dedicated savings fund for this purpose. This way, you’ll still be financially prepared for the future.
- Monitor Your Health: Keep a close eye on your health condition and seek ways to improve it. As your pre-existing condition evolves or becomes more manageable, you may become eligible for life insurance in the future.
Remember, while a denied life insurance application can be disheartening, it doesn’t mean you have no options. By managing your finances wisely and working on your health, you can better prepare for your future security.
Final Thoughts on Life Insurance with Pre-existing Conditions
Don’t let pre-existing conditions keep you from ensuring your family’s financial future. Take action today and discover the life insurance solutions tailored to your unique circumstances.
By exploring your options, staying informed about the latest developments in the insurance industry, and seeking expert guidance, you can find the coverage you need to protect your loved ones.
Get started on your journey towards peace of mind by speaking with a knowledgeable insurance advisor because your loved ones deserve the best.