Having a medical condition doesn't automatically disqualify you from buying life insurance. While finding coverage can be more difficult than it is for others, individuals with challenging medical histories and even severe conditions can usually find at least some coverage.
Terminology varies, but life insurance companies typically have several pricing tiers:
In seeking coverage, you should bear the following in mind:
Expect higher premiums. The more severe your pre-existing condition, the higher the premiums you can be expected to pay. It's a function of the historic mortality rates of others near your age in similar health.
Use an independent insurance broker. Each insurance company underwrites risk in different ways. For example, some companies are more willing to take on individuals with diabetes than others, or have looser requirements. An independent insurance broker can present your application to a number of different carriers with favorable underwriting to get the best policy for you, at the best possible price.
Expect to provide more records. Once you submit your application, your carrier may want additional medical records or other tests before issuing a policy. Don't be discouraged or frustrated by this process - often, the underwriters are asking for more information to justify putting you in a more affordable risk category.
Limited underwriting policies. Some carriers issue smaller policies with no medical exam and limited medical underwriting. They may just do a medical records check and ask you a few health questions. These policies are easier to qualify for, but because they attract others with health problems, the premiums are more expensive than with fully medically underwritten policies.
Guaranteed issue life insurance. A few carriers will issue small whole-life policies - typically $25,000 - on a nearly guaranteed basis. There may be an exclusion period of two to five years before the policy will pay a benefit. These smaller policies are useful as burial and final-expense policies.
If your pre-existing condition is not severe, you may be better off applying with a fully underwritten life insurance policy than with a limited underwriting or guaranteed acceptance policy.
Workplace group life insurance. Some employers provide smaller no-underwriting or limited underwriting policies to all full-time employees. You may just have to answer a few health questions, or you may automatically qualify just by being an employee. These policies may not be portable, which means that you lose coverage if you leave the company.