How to Get Cheap Life Insurance With Preexisting Medical Conditions
When it comes to life insurance, there are a variety of health issues that can be considered preexisting medical conditions, which can either raise your rates or prevent you from applying for coverage. However, depending on the nature of your medical issues, you can usually find an insurance company that will provide low-cost quotes for the coverage you require.
Even if you have a preexisting medical condition, term life insurance is typically the cheapest form of coverage, but not everyone can pass the underwriting stage. In such cases, policies such as no medical exam or guaranteed issue are more expensive but accept a broader range of medical problems. A preexisting condition may limit the amount of your death benefit under any of these policies.
Term life insurance with preexisting conditions
Term life insurance provides coverage for a specific time period — typically between five and 35 years — during which your beneficiary will receive a payout if you die. If you qualify for term life insurance, a preexisting condition will significantly increase your quotes. Term life insurance, on the other hand, allows you to select a much higher death benefit than products with limited underwriting.
Term life insurance quotes are heavily influenced by your health, and insurers have four standard health rating tiers. Premiums vary slightly within a given health tier, but if you have a serious enough medical condition to move up a tier, the quotes you receive will be much higher.
Health tiers for term life | Description |
Preferred Plus | Perfect health. You won’t qualify if you have a preexisting medical condition. |
Preferred | Perfect health besides one minor issue, such as slightly elevated blood pressure. |
Regular Plus | You have a preexisting condition that is low-risk or has a small impact on your general health (such as asthma). |
Regular | Average health. Requirements vary by insurer, but insurers often accept preexisting conditions that are moderate-risk, such as diabetes. |
Each insurer has its own set of health requirements and conditions that it will insure. If you have a preexisting condition, you should speak with an independent insurance agent. Agents represent multiple companies and have the knowledge to determine which insurer will provide you with the best rates.
No medical exam and simplified issue life insurance with preexisting conditions
Policies with simplified issue and no medical exam are either term or permanent life insurance policies that have fewer underwriting requirements. There is no medical exam, and the application may contain fewer health questions depending on the insurer. Simplified issue policies have lower maximum death benefits than fully underwritten policies, but some insurers offer coverage up to $250,000.
When you apply for simplified issue life insurance, you will be asked several health questions in order to determine whether you qualify for coverage and, if so, what premiums you are eligible for. It is critical to be truthful because insurers will check your answers against multiple databases on a regular basis and may cancel your coverage if any discrepancies are discovered.
Depending on the insurer, you may be denied simplified issue life insurance if you:
- You are a resident of a nursing home or treatment facility.
- You have limited mobility and require a wheelchair.
- You have a high-risk illness, such as cancer, HIV, or kidney disease.
- You're undergoing dialysis.
- You've been diagnosed with a disease, such as diabetes, in the last two years and haven't been able to control it consistently with medication.
- You suffer from cognitive impairments.
For healthy people, we don't recommend simplified issue policies because you'll pay more for the same coverage. Some agents will feature the convenience of no medical exam policies, but the time saved by skipping the medical exam (which typically takes less than an hour and can be scheduled whenever is most convenient) does not offset the additional cost of higher premiums over time. However, if you do not qualify for fully underwritten term life insurance or if your preexisting medical condition is significant enough that most insurers will not accept it, these policies are a good alternative.
Guaranteed acceptance life insurance with preexisting conditions
Guaranteed acceptance policies are typically whole life insurance policies that provide coverage for the rest of your life as long as you continue to pay premiums. There are no health questions during the application process, and you are not required to take a medical exam, so these policies are an excellent option if you have severe preexisting conditions.
Death benefits for guaranteed acceptance policies are typically limited to less than $25,000 in most cases. Guaranteed acceptance coverage should be sufficient if you want enough coverage for end-of-life costs such as a funeral. Unfortunately, if you have a severe enough preexisting condition that you are ineligible for non-guaranteed coverage, you are unlikely to find an insurer that offers more than $50,000 in death benefits.
Furthermore, guaranteed acceptance policies typically have a two- to three-year period following purchase during which your beneficiary will receive little to no payout if you die. For example, if you die within the first two years of purchasing Colonial Penn's guaranteed acceptance policy, your beneficiary will only receive the sum of your premium payments plus 7 percent compounded annual interest.
Because the insurer accepts all applicants, a guaranteed acceptance policy will almost always be the most expensive option for a given amount of coverage. We don't recommend guaranteed acceptance life insurance if you're healthy enough to qualify for term life insurance because of the high quotes. In some cases, depending on your medical conditions and insurer, quotes can be so high that you pay more in premiums than your beneficiary receives as a payout over the life of the policy.
Which preexisting conditions matter when getting life insurance?
Preexisting medical conditions in the context of life insurance include a wide range of health issues ranging from heart disease to obesity. We've listed some of the most common health issues that could prevent you from getting life insurance or cause you to pay higher premiums.
With the current global spread of COVID-19, life insurance companies are seeing an increase in interest from people who are motivated to get coverage due to concerns about infection. If you currently have COVID-19, some life insurance companies may consider it a preexisting condition and require you to reapply after you have recovered. On our FAQ page, you can learn more about the coronavirus's impact on life insurance.
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