Does Being Transgender Affect Life Insurance Rates

Please note the statements are the responses of underwriters at some of our life insurance companies and do not reflect the views of Quotacy as a company.

When a person is using (or has used) hormone therapy treatment and/or has had any gender-affirming surgeries, it will not only affect the rates for which they apply, it may also affect the requirements needed during the underwriting process.

If you have transitioned or are in the midst of, the following factors will be evaluated by the insurance company:

The stage of your transition
Whether or not any drug therapies used—or that you will continue to use—are experimental (and therefore may have unforeseen side effects)
If your surgery and/or drug therapies resulted in health issues that are likely to continue

These factors along with the typical age, occupation, and hobby factors are considered when determining the risk class given to an individual. The medical records of a transgender individual will be ordered and reviewed.

If you have a gender-affirming surgery scheduled, the majority of life insurance companies will postpone your application until after surgery is complete.

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Laws that Protect Transgender Insurance Rights

Many states have taken huge strides towards clarifying the legal standing of LGBT people in their states.

For example, some states have codified more inclusive definitions of gender:

In California:

“Gender” means sex, and includes a person’s gender identity and gender related appearance and behavior whether or not stereotypically associated with the person’s assigned sex at birth.” California DOI 2007-02

“Existing law authorizes a person who was born in this state and who has undergone clinically appropriate treatment for the purpose of gender transition to obtain a new birth certificate from the State Registrar.”
Senate Bill No. 179 Chapter 853

And in Delaware:

“Gender identity” means a gender-related identity, appearance, expression or behavior of a person, regardless of the person’s assigned sex at birth. Gender identity may be demonstrated by consistent and uniform assertion of the gender identity or any other evidence that the gender identity is sincerely held as part of a person’s core identity; provided, however, that gender identity shall not be asserted for any improper purpose. Delaware, S. 97, 2013

This means that companies in these and other states with similar definitions of gender and gender identity can be held accountable to uphold relevant non-discrimination standards in their business practices.

However, the interpretation of how those standards apply to the underwriting of life insurance policies for transgender people has been under debate within the industry for some time.

Fortunately, many states have taken steps to make the interpretation of these laws easier as well.

For instance, Delaware has created comprehensive guidelines for life insurance companies with regards to transgender and transexual applicants. As we’ve seen above, Delaware law accepts that gender identity is not necessarily the gender that you were assigned at birth.

Since discrimination based on gender identity is prohibited by state law, this also applies to business practices within the insurance industry.

“No person shall make or permit any unfair discrimination between individuals of the same class and equal expectation of life in the rates charged for any contract of life insurance or of life annuity or in the dividends or other benefits payable thereon, or in any other of the terms and conditions of such contract.”

“No person shall make or permit any unfair discrimination between individuals of the same class and of essentially the same hazard in the amount of premium, policy fees or rates charged for any policy or contract of accident or health insurance or in the benefits payable thereunder, or in any of the terms or conditions of such contract, or in any other manner whatever.”

A bill is currently proposed in the state of New Jersey with language specific to prohibiting discrimination of transgender individuals:

“No person shall make or permit any unfair discrimination in the issuance, extension, or renewal of a life insurance policy or in the fixing of the rates, terms, or conditions of a life insurance policy, against an individual on the basis of:

(1) an individual’s transgender status, including a diagnosis of gender dysphoria and any related medical treatments; or

(2) any apparent incongruence between the individual’s gender identity and the individual’s sex assigned at birth, or the gender designated in the individual’s insurance application or records or other identification documents.”

This means that in states with non-discrimination laws protecting transgender and transexual people, insurance company underwriters cannot discriminate against you—or place your application in a higher risk class of applicants—if you match the criteria of a Preferred class (or very low risk) applicant.

Don’t let the uncertainty of LGBT anti-discrimination laws keep you from applying for term life insurance.

At Quotacy, we’re sensitive to the challenges that transgender people may face while searching for life insurance quotes and eventually finding the right policy. Our agents are always ready to help if you’ve decided to become insured and have some questions.