Life Insurance for People Living With Disabilities
Quick Facts
If you or a loved one is living with a disability, you still have options for life insurance coverage
Your life insurance eligibility and rates will depend on the type of disability, its severity, and your overall health
For people with serious disabilities who don’t qualify for traditional term or permanent life insurance, there are options that don’t require a medical exam
According to a recent study by the Centers for Disease Control, about 26% of adults in the United States live with a disability. One in every four adults in the U.S. looking for life insurance has the same questions and concerns as you.
Having life insurance is essential. Having life insurance if you are living with a disability often makes having coverage that much more important. But having a disability, particularly a life-threatening disability, can make finding coverage a little more challenging, especially if you are attempting to find cheaper life insurance premiums.
The good news, however, is that regardless of your disability and its severity, it is still possible to get life insurance and protect your family.
How can a disability affect my premium?
Every life insurance company has a different system for assessing your level of risk and underwriting your life insurance policy. In addition, they will evaluate you individually to determine how your disability impacts your daily living activities and overall health.
They will also take into consideration other factors like your income, your lifestyle, your credit, and your health history.
In general, the more of an effect the disability has on your life expectancy, the more it will impact your life insurance options.
If your disability doesn’t affect your life expectancy, it might not increase your premium. However, if it does, you can look into life insurance policies specifically for people with disabilities that are considered high-risk. These “high-risk” policies are often referred to as guaranteed issue life insurance policies.
The guarantee is that you cannot be denied coverage despite pre-existing medical conditions, like a disability if you are willing to pay higher premiums and undergo a waiting period for life insurance.
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What is considered a disability?
According to the Adults with Disabilities Act, a disability is “a physical or mental impairment that substantially limits one or more major life activities.”
Primary, or daily, living activities include:
Hearing, vision, or other senses
Movement
Thinking and remembering
Communication
Mental health
Disabilities range from mild to severe, they can be hidden or obvious, and a doctor must document most. Still, the question remains whether you can buy life insurance while on disability or if you’re disabled.
The Americans with Disabilities Act specifies that people with disabilities can’t be denied certain services. In addition, since disabilities can affect your overall health and life expectancy, life insurance companies can consider your disability when determining how much life insurance to offer you and what to charge for your premium.
How you manage your disability, the severity of your disability, and your family history all affect how your disability impacts your insurance options and rates.
But how exactly does insurance work for people with a disability? Continue reading to discover how having a disability can affect your rates and company selection.
When does a disability affect your ability to get life insurance?
Your ability to get a standard life insurance policy generally changes if the disability you have is connected to a condition that might affect the length of your life.
For example, suppose you are blind or unable to walk because of a severe health condition like diabetes, cancer, or traumatic injury. In that case, you might find that life insurers charge you higher premiums or even reject your application altogether due to your disability affecting your daily living activities.
Similarly, if you have a mental disability like major depression, schizophrenia, or bipolar disorder, insurers might be concerned that you could develop self-destructive behaviors, so your access to particular life insurance policies or the cost of a life insurance policy might be affected.
What determines my rates with a disability?
There are several factors insurance companies consider when they issue life insurance for people with disabilities.
First, the cause of your disability is an important determining factor. For example, suppose you are currently on disability or suffer from a disability due to an accident. In that case, you will be easier to insure, in general, because an accident usually has less of an effect on your overall life expectancy.
Disabilities caused by chronic, critical, or terminal illnesses can be trickier to cover. However, depending on the severity of the disease and how well it’s managed, you might be required to be a guaranteed issue policy.
Second, medical treatments and medications will also be taken into consideration. A life insurance company will assess things like any treatments, prescription drugs you take, and previous surgeries or hospitalizations using the Medical Information Bureau (MIB).
Last but not least, your overall health, including tobacco use, will be considered when determining policy and rates. Therefore, it is in your best interest to be in the best health you can be, disability aside. Find out how to access the Medical Information Bureau (MIB).
What if I am considered “high risk” or denied coverage?
If your disability significantly impacts your overall health or ability to care for yourself, you may not qualify for a standard term or permanent life insurance policy. However, other types of life insurance can provide some financial support to your loved ones despite you being considered “high risk.” Find life insurance for high-risk individuals here.
If your disability does not prevent you from working but is still being denied standard coverages, you may want to consider group life insurance. If you get life insurance through your employer, you are not subjected to individual health assessments or underwriting.
If, however, you cannot work due to your disability, then it’s time to look for a guaranteed issue policy. These policies usually offer up to $25,000 in coverage and have a two-year wait period. This waiting period means you must survive the first two years of your policy before the death benefit is paid out to your beneficiary.
Do not abandon hope of finding a life insurance policy just because you live with a disability. Many companies are willing to offer coverage if you take the time to shop around.
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Here Are a Few Tips on Life Insurance for Disabled People
Some companies offer life policies specifically for disabled adults, so you might want to shop around
You may want to get quotes from several insurers, especially if you are considered “high-risk”
Improve your current health situation by dieting and exercising if you can
Work with a broker to find the best company and coverage
If your employer offers group life insurance, it may provide a way to get some life insurance protection at little or no charge to you, despite pre-existing conditions
Final Thoughts on Life Insurance for Adults With Disabilities
Living with a disability can be hard enough. No need to add stress to your life by worrying about whether or not you can get life insurance. The great news is that even with a disability, you can still get life insurance.
Depending on your disability and other risk factors, you may qualify for certain standard-term or whole-life products. However, if you are considered “high risk, ” your options will be limited to guaranteed issue (GI) policies.
Sure, when you sign up for a guaranteed issue policy, you will have a waiting period and won’t be able to avoid higher premiums. What’s important to remember, however, is not your higher premium but your ability to get insurance despite your disability.
Regardless of what disability you may be living with or its severity, there are still companies out there who understand your desire to protect your family and are willing to insure you despite pre-existing medical conditions like a disability. Just make sure to shop around before making any decisions.
Frequently Asked Questions
Is disability included in life insurance?
Disability coverage is not automatically included in life insurance policies, but you can get disability riders added to your policy at an extra cost. You will need to purchase any disability riders you want during the application process.
Are life insurance and disability insurance the same?
While life and disability insurance both offer income replacement, they are not the same. Life insurance protects the financial health of your beneficiaries after you die, whereas disability insurance pays out to you while you are alive and if you become too disabled to work.
Can I get life insurance while on disability?
Yes, but depending on your medical condition, you may have to pay a higher rate.
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Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance-related. We update our site regularly, and all content is reviewed by life insurance experts.
Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states.
After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in…
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Written by
Rachael Brennan
Licensed Insurance Agent
Benjamin Carr worked as a licensed insurance agent at State Farm and Tennant Special Risk. He sold various lines of coverage and informed his clients about their life, health, property/casualty insurance needs.
Assessing risks and helping people find the best coverage to suit their needs is a passion of his. He appreciates that insurance was designed to protect people, particularly during times…
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Reviewed by
Benjamin Carr
Former State Farm Insurance Agent
