Learn all there is to know about insurance.
Term life insurance usually is the least expensive type of life insurance. It guarantees your rates won’t change during the term of the policy, such as 10, 15, 20 or 30 years. The payout from a term life policy can replace your income during prime working years and help your family pay off debts.
Permanent life insurance costs more than term life insurance. Permanent life insurance, such as whole life insurance or universal life insurance, provides a death benefit to beneficiaries when you die and also can provide the opportunity to build cash value within the policy. You can use the cash value to supplement retirement income or to pay medical bills. Permanent life insurance lasts your entire life—as long as you pay the premiums required.
With guaranteed issue life insurance you can’t be rejected for coverage and there’s no medical exam. If severe diabetes would prevent you from buying a traditional policy, guaranteed issue life insurance could be a last-resort option.
Another consideration: Guaranteed issue policies have graded death benefits. If you pass away within the first couple years of the policy, your beneficiaries don’t get the full death benefit. Instead they get a sum that equals the premiums you paid, with some interest.
Before you purchase this type of policy, work with a life insurance agent to see if you really would be declined for other policies. Guaranteed issue life insurance is typically expensive for the amount of coverage you get.
It’s also worth maximizing any group life insurance you have through your employer. This type of life insurance covers all employees as a group, but none of the employees are required to divulge their medical history. Death benefits are typically low for group life insurance, often a year’s salary or a flat-dollar sum. If you can buy more without having to prove “insurability,” maximize this coverage.
When shopping for the best life insurance for diabetics, it’s essential to understand what factors insurers look at when deciding your eligibility. Be prepared to provide the following information when you apply for life insurance for people with diabetes:
This is the age you were when you were diagnosed with diabetes. Typically, the older you were diagnosed, the better your life insurance rate will be.
Most diabetes cases in America are Type 2, and insurers typically offer better rates than those offered to Type 1 diabetics. This is mainly because Type 2 is more easily controlled through diet and lifestyle choices, whereas Type 1 is insulin-dependent. Most carriers will not approve someone with gestational diabetes unless they apply for guaranteed-issue life insurance.
While treatment plans vary, how well you’re managing your diabetes is an important factor for a life insurance provider. If your diabetes and blood sugar are well-controlled through medication, regular doctor’s visits and a healthy lifestyle and diet, you stand a better chance of getting the best life insurance rates for diabetics.
The health history of your parents and siblings can also affect your life insurance eligibility and rate. If members of your immediate family died before they were 60, had diabetes themselves or have complex health histories, a life insurance company could view you as too risky to insure, especially if there are genetic conditions at play.
When people with diabetes apply for life insurance, the rest of their health makes a big difference. If you have high blood pressure or are overweight, your rates could skyrocket or even make you ineligible for coverage. Alcohol use is another determining factor since excessive consumption can lead to diabetes-related complications such as retinopathy, a diabetic eye disease.
Yes, people with Type 2 diabetes can buy a life insurance policy. Life insurance companies look at various factors to determine how much you’ll pay for life insurance for Type 2 diabetes. Your age at onset, how well it’s controlled and the treatment plan in place are key factors used to determine eligibility and pricing.
Yes, people with Type 1 diabetes can buy a life insurance policy, although it can be more challenging to get approval than it can be for people with Type 2 diabetes. Type 1 diabetes is less common and harder to control, which means it’s riskier for insurers to offer life insurance for Type 1 diabetes, but not impossible. If you are otherwise healthy, you stand the best chance of getting approved at an affordable rate.
People with diabetes can expect to pay more for life insurance than average. The age at which you were diagnosed, whether you have Type 1 or Type 2 diabetes, your treatment plan and how well your diabetes is managed will determine your rating class. If you have other health conditions, it can be challenging to get approval for life insurance.
The amount you’ll pay above average rates depends on your age, the type of life insurance you apply for and how much coverage you need. Each company looks at diabetes differently, so you should get several quotes to determine which life insurance company is best for you.
A guaranteed-issue life insurance policy is typically the easiest type to get approval for if you have diabetes. This type of life insurance doesn’t include health questions on the application, and you won’t be required to complete a medical exam. However, a guaranteed-issue life insurance policy is usually the most expensive policy you can buy.
People with diabetes have a few opportunities to lower their life insurance policy premiums.
For example, quitting could lower your rates if you’re a smoker. However, keep in mind that you won’t be eligible for nonsmoker rates until you’ve been tobacco-free for at least 12 months.
You can also use health technology, like a wearable device that tracks and encourages healthy lifestyle habits, to bring down your life insurance expenses. Some companies, like John Hancock, even offer discounts on life insurance if you improve your health and allow them to monitor your activities.
Having a good management and treatment plan is also essential in staying in control of your diabetes and reducing future complications. Anything you can do to reduce your mortality risk is good in the eyes of a life insurance company, and you will often be rewarded with lower policy costs.
The riders offered on life insurance policies vary by company and policy type. You should explore all rider options but pay particular attention to living benefits.
These benefits, also called accelerated benefit riders, allow you to withdraw money from the death benefit while you’re still alive. If you are diagnosed with a chronic, critical or terminal illness, you can access the death benefit and use the money in any way you choose.
A guaranteed-insurability rider is another option to consider. This rider lets you buy more life insurance at specific ages or life events, like getting married or having a baby. Your health isn’t a factor, so you can increase your insurance even if your health has worsened since you took out the life insurance policy.
The waiver of premium for disability is another valuable rider. With this rider, your life insurance policy premiums are paid once you meet the qualifying criteria, usually a waiting period. If you become disabled, this rider can prevent you from lapsing your life insurance if you can’t afford the premiums.
If any of the above sounds like it may fit your needs or maybe you still have some questions we didn’t cover, please call Seth Lindquist with Sirrel, LLC to provide a quote for you.