What You Should Know About Life Insurance if You Have Mental and Behavioral Health Issues!
Life insurance and Mental illness effects on the insurance policy is a crucial topics for many people trying to protect their loved ones. Millions of people in Canada have some form of mental illness but still want to protect their families and dependents should something happen to them. As a result, having any of these issues can impact whether you qualify for life insurance or if it impacts your policy rates. However, that does not mean that all insurers will deny you life insurance or offer you high rates. Let’s take a closer look at all the facts:
Can you buy life insurance if you have a mental issue?
Mental and behavioural health disorders do differ, as do individuals. However, people suffering from these often manage to get coverage at affordable rates. Getting an online quote is easy, but a broker can help you to research the market even better, making it easier to get approved. A broker can shop around and inquire from insurance providers about your condition before applying for any policies.
How does the underwriting for my policy work?
As a result of the many different types of disorders related to mental and behavioural health, life insurance policies require independent underwriting. For example, the treatment plans and insurance risks for a person with dementia differ from those of someone with depression or anorexia.
Even two people with depression or post-traumatic disorder (PTSD) can have different symptoms and outcomes, meaning it’s essential for life insurance underwriters to evaluate each case differently.
Underwriters must consider and evaluate several factors for each applicant:
- Physical and mental health
- Job and employment history
- Social Activities and family dynamics
- Evidence of substance abuse (including alcohol)
- History of suicide attempts
- Additional chronic medical conditions (such as heart disease, diabetes, etc.)
- Severity and duration of the mental or behavioural diagnosis
- Family history
- Behavioural disturbances
- Treatment history
Once the underwriters determine the risks for the insurer, they decide if you qualify for life insurance by adding you to a risk class—the lower your risk class, the lower the cost of the premium, and vice versa.
What will my rate be?
Once your risk is determined, prices vary. The risk table has about 11 categories, starting at the top with the lowest risk group known as Preferred Plus. After that, the categories get named Preferred, Standard Plus, Standard, and so on.
For example, a 30-year-old wanting a 20-year term life insurance will pay approximately $16 if they fall at the lowest risk level. Still, that premium increased by around 25% for every step below the risk table.
Of course, insurance companies each underwrite in their own way; this is just one example.
Want to find out what your life insurance rate is?
Find the best rates from top life insurance companies in Canada!
What mental conditions are acceptable for life insurance to issue a policy?
Insurance companies generally accept all mental and behavioural conditions for life insurance coverage but will first underwrite their risk. So, depending on the company, suicide.
Additionally, a beneficiary may not get the death benefit if you have lied on your application, and sometimes insurers add a contestability clause for the first few years.
These are just some conditions covered:
- Anxiety
- Depression
- Stress
- PTSD
- Borderline personality disorder
- Bipolar disorder
- OCD
- Paranoia
- Psychosis
- Schizophrenia
- Anorexia nervosa
- Bulimia nervosa
- Phobias
- Self-harm
- Suicidal thoughts
- Suicide attempts
Should I buy nonmedical life insurance or go with a fully underwritten policy?
Nonmedical life insurance means your insurer does not ask questions, and you don’t undergo a medical examination. Instead, you get a policy without the insurer underwriting the risks. The coverage amount capped by the insurer is low, but if you don’t qualify for any other life insurance, it provides your family with some coverage.
Does prescribed medication affect your life insurance purchase?
Medication can help control most mental health and behavioural conditions, making qualifying for life insurance more accessible. It is crucial for insurers that your health condition is stable and your medication is unchanged. This will help you to qualify for much better insurance rates.
Some Important Life Insurance Facts
People with a history of severe depression or other similar conditions can also qualify for a graded death benefit policy which pays only 25% percent of the death benefit when first covered—the amount paid out by the policy increases to the total death benefits after about four years. However, almost all life insurance policies contain a suicide clause that prohibits payment benefits or issues a small percentage if the policyholder dies by suicide.
Life insurance and Mental illness Bottom Line
People diagnosed with medical, mental, or behavioural problems often find it hard to get life insurance, but as you can see from this article, it is possible to get protection. If you can’t get the life insurance coverage you want because of your problem, consider a nonmedical policy or a graded death benefit.
Always shop around when looking for life insurance, and provide as much proof as possible that you manage your condition correctly. In this way, you can be sure that your loved ones have the security they deserve should something happen to you.
Purchasing life insurance with Mental and Behavioral Health Issues
Your life insurance policy offers your family the security they deserve. Making sure you have sufficient life insurance coverage regardless if you have a mental or behavioural health issue is your right. Do not be afraid of getting rejected or paying a high premium for a life insurance policy; connect with an insurance expert and find out.
An expert advisor is the best person to help secure your family’s financial future and guide you to find the best life insurance type. A financial advisor or insurance agent will assess your financial needs and look at the existing health conditions you may have. They will find a way to cover all your life insurance needs within your budget.
The life insurance process has remained mostly online since the covid-19 pandemic. Thanks to our expert advisers, who are comfortable with the online life insurance platform, you can take advantage of their expert opinion on your life insurance options by considering your age, health, liabilities, and goals. At Apluswealth, you can get a quote, compare quotes, and find the life insurance quote you feel comfortable with. Our life insurance advisors will provide quotations and the most suitable policy types.
Contact our expert advisers today to find the best life insurance.
Email: Contact@apluswealth.com
Tel: 1-888-461-6120