Finding affordable life insurance for diabetics can be disappointing without the right research or approach. Diabetes is one of the leading health concerns in the United States.
According to the Centers for Disease Control (CDC), 25.8 million children and adults, or approximately 8.3% of the U.S. population, had diabetes as of 2011.
Of those Americans, 18.8 million have actually been diagnosed, and an estimated 7.0 million people have yet to be formally diagnosed by a physician. In fact, 1.9 million individuals aged 20 years or older were newly diagnosed in 2010, and that number is expected to remain fairly consistent through the years.
Although you may be concerned about buying life insurance as a diabetic, given these statistics, you can see that you are not alone. Cheap life insurance for diabetics is available and accessible despite your diagnosis – you just have to know how and where to look.
Why You Need Life Insurance As A Diabetic
The most important factor in your search for diabetes life insurance is control of the disease. The best policies and cheapest rates are reserved for diabetics who take steps to lead healthy lifestyles, maintain low A1C and glucose levels, visit their doctor regularly, and respond best to medical treatment. However, even if you don’t lead an exemplary lifestyle, there are ways to find diabetic life insurance.
A lot of people put off buying life insurance because they don’t understand the need for it, or don’t want to have to think about their own mortality, but life insurance is one of the most important things you can purchase for you and your family. Life insurance is one of the things that nobody likes to buy, but not having a policy can be the biggest mistake you can make.
If something were to happen to you, would your family have the money they need to get through the difficult time of their lives? How will they pay the funeral expenses, which can cost $10,000 or more? Would your family have enough money to pay the mortgage or car payment? Life insurance is there to give them the money they need to not add any stress during the difficult times.
Types of Life Insurance Policies
Before we discuss life insurance for diabetics, you need to understand the fundamentals of life insurance itself. There are several key terms and phrases that can confuse some consumers.
There are two types of life insurance, term, and whole. Term life insurance is a policy that is only effective for a predetermined period, called a “term.” These terms come in different ranges, anywhere from 5 years to 30 or more. The longer term you choose, the cheaper the policy normally is. These policies are typically the cheaper of the two options.
Whole life insurance is exactly what it sounds like; it is valid for your whole life. Unlike term life insurance policies, these policies do not have an “expiration date”, as long as you continue to make monthly payments, the policy is effective. Some whole life policies also build cash value as you pay your monthly premiums. For some people, the cash value is an attractive addition, but it does mean that the policies tend to be more expensive.
Type 1 versus Type 2 Diabetes
The National Diabetes Information Clearinghouse reports that Type 2 diabetes strikes between 90 and 95 percent of cases diagnosed in the United States. It is much more common among young people than it used to be, which is why it is no longer called “adult onset diabetes.”
Type 2 diabetes is far more responsive to diet and exercise than Type 1, and oral medications and insulin therapy are also very effective in management of the disease.
For these reasons, insurance companies do give importance to how well your body responds to your treatments. Overall, as a Type 1 or Type 2 diabetic, you will be able to get the best life insurance rates if your diabetes has been under control for at least 6 to 12 months, even if you are insulin dependent. And generally, premiums for Type 2 diabetes are more affordable than Type 1.
Factors That Affect Rates on Life Insurance For Diabetics
Life insurance companies look at your current health and medical history alongside other risk factors to assess the costs of insuring you. The factors that will affect life insurance quotes for diabetics include the following:
- Type of diabetes
- Glucose/blood sugar levels
- When (age) you were diagnosed
- Control factor
- Medications you are prescribed
- Additional health risk factors
- Your current age, height, and weight
- Your medical history
- Family medical history
Although it is true that diabetics typically pay more than the average healthy buyer of life insurance does, the cost of premiums will vary based on how the insurers assess each particular customer as a risk. It is important to note that younger diabetics also face more costly premiums than do those who contract the disease later in life.
Then there are four standard ratings classes, listed below from highest to lowest, with the cheapest rates offered to top ratings classes.
- Preferred Plus is the “healthiest” classification and has the lowest premiums.
- Preferred, sometimes known as “Standard Plus”, is the classification which follows preferred plus. Preferred class premiums are costlier than those of the preferred plus classification, but still very affordable.
- Standard is the next classification on the list. These premiums are higher still, yet affordable when you need life insurance.
- Substandard has the highest premiums. Those with the poorest health will find themselves classified here.
If you can prove that your Type 2 diabetes is under control, you have a good chance of being placed in either a “standard” or “standard plus” class for premiums, depending on how favorably your carrier underwrites policies for diabetics. A solid history of control of the disease for a minimum of 6 months and no other contributing health risks will be required to get the best rating possible. If you’ve had more trouble controlling your symptoms or if your response to treatment has been spotty, be prepared to show a longer positive history.
Unfortunately, if you suffer from Type 1 diabetes, you are probably going to be classified in the “substandard” category. Even if you are ranked “high substandard,” your premiums are likely to be costly. These classifications are going to increase your premiums with Type 1 diabetes regardless of how well you control the disease. While you might not get the rating you want, a lot of people are surprised at just how affordable their monthly premiums.
Other Life Insurance Policies For Diabetics
Typically, diabetics who do not have their diabetes under control are not likely to be approved for a term life insurance policy. Furthermore, diabetics who are at risk for other diseases, such as heart disease, high blood pressure, obesity, cancer, stroke, or smoking, are also rarely approved. If these are your circumstances, your only option may be to purchase no exam guaranteed-issue life insurance.
However, these types of life insurance policies do not usually vest until they have been in force for at least three years. In other words, you are not covered for those initial years till the exclusionary period passes. Finally, non-medical exam and guaranteed life insurance policies do not normally pay out more than $50,000.
No Medical Exam Life Insurance
No medical exam life insurance is a type of coverage that allows you to skip a health exam. No exam policies are usually best for applicants who want insurance fast and need to avoid the complete underwriting process, have a phobia of medical examinations, or have a health condition that prevents them from applying for traditional coverage. Unfortunately, a questionnaire is still required as part of the application process.
As with any other condition, it is absolutely essential to be truthful on your application. If you do not provide your insurance company with accurate information about your diabetes, you are putting your family and beneficiaries at risk of being denied a claim in the future. Life insurance companies can and often do investigate claims including medical and health histories. Investigations that uncover material misrepresentations or fraud result in canceled policies and no payouts.
This no-exam option is a more likely scenario for those with Type 2 diabetes, but please remember that any no exam life policy tends to be much more expensive and comes with a limited death benefit, usually up to $100,000. This is because, without an accurate way to assess risk factors, life insurance companies must increase premiums to leave a safe margin of error.
How To Shop For Affordable Diabetic Life Insurance
Before you begin shopping for cheap life insurance, make sure you are in the best health you can be. Make control of your diabetes your first priority, while considering these tips on buying life insurance:
- Make sure your diet is healthy
- Maintain your healthy body weight
- Always take the medication your doctor prescribes
- Make and keep your regular doctor’s visits
- Have routine eye exams
- A1C levels below seven will get you the best underwriting results
- Premiums are lower for those applicants diagnosed at an older age
- Do not expect a “Preferred” Rating Class. The best-case scenario is a “Standard” or “Standard Plus” rating
Companies that specialize in high risk coverage, such as life insurance for smokers, may offer the lowest rates. However, if your health is better than your diagnosis might suggest, carriers that provide more detailed evaluation processes known as “clinical underwriting” may offer more affordable policies.
Because your health plays such a critical role in determining your rates, it could be a good idea to take some time to improve your health if you are not in the best condition. Instead of applying for a life insurance policy now, take a year and get your numbers where they should be. With type 2 diabetes a healthy diet and regular exercise and make a huge difference when it comes to your life insurance policy. If you can lower you A1C levels, maintain healthy glucose levels, and possibly eliminate medications that you’re prescribed, it can save you thousands of dollar every year.
Clinical underwriting is an evaluation process that examines your overall health rather than simply focusing on your specific health risk factors like diabetes alone. If you do have a very healthy lifestyle and can show other indications of good health, clinical underwriting might be a good alternative strategy. Either way, you always need to compare life insurance quotes from multiple companies before purchasing protection.
Methods of Calculating Premiums
Some companies assign rates by using either “flat extra” premiums or “table rates.” A flat extra is an additional, set charge based on a statistically calculated increase in risk. Typically, this risk is calculated based on the amount of the death benefit so that your extra charge will be higher for every $1,000 of coverage you purchase. In other words, for every $1,000 of coverage you buy, you might have an extra $5 or $10 premium per month. The bright side of this is that flat extras usually end within some set period—the most common period is three to seven years.
Table rating systems are similar to flat extras such that table rates allow companies to increase and decrease rates based on health risk factors; if you do not qualify for normal premiums due to your health, you might be assigned rates via table ratings. For most insurance companies, this type of system includes tables that are labeled with letters or numbers. The most common rate insurers assign to tables is 25%; this means that for every table rating assigned to you, your rate increases by 25%.
The best way to understand this is to think of it as a credit and debit system. A diabetes diagnosis would be a debit against you, while something like healthy blood pressure might be seen as an insurer as a credit. How many credits or debits any particular health issue carries with it varies from company to company.
As an example, a company might rate you as Table 1 (one table) or Table 2 (two tables) as a diabetic. If you are Table 1, for every $1,000 of standard premium rate, your rate would be $1,250; as a Table 2, your rate would be $1,500. If your insurer uses a table rating system, your policy will remain the same throughout the life of the policy; this is the primary difference between flat extras and table ratings.
Getting the Cheapest Life Insurance
While you aren’t going to get as cheap of rates as a non-diabetic, there are some things you can do to lower your monthly premiums. The first is to compare rates, don’t go with the first company you receive a quote from. Because each company is different, they all have different criteria for their quotes, which means that one company could have drastically different rates compared to a different company.
If you’re looking for the best rates possible, make sure that you work with an agent and company that have experience working with diabetics. There are a lot of companies that look at diabetes unfavorably, which causes them to give rates that are through the roof, but there are a lot of companies that understand the condition and how it can be managed. It’s important that you work with agents experienced with the condition and can get you an affordable policy.
Because diabetes is going to cause your rates to go up, make sure that you aren’t doing anything else to cause your rates to skyrocket. Lifestyles choice like smoking or having dangerous hobbies will make your monthly premiums go even higher than they were before. If you want the lowest rates possible, it’s time to get the bad habits. Avoid smoking, excessive drinking, and dangerous hobbies like riding motorcycles or rock-climbing.
How Much Do You Need?
When you’re looking to purchase a life insurance policy, one of the first things you need to determine is how large of a policy you need. While there is no, “one-size-fits-all” answer, there are a couple of things you should consider to come up with the perfect plan size.
How many people depend on your salary? If your spouse or loved ones don’t rely on your salary, then you won’t need a large life insurance policy. But if your spouse and children need your income to get by, then you should consider a bigger policy.
How much debt do you have? One of the main purposes of life insurance is to pay off any expenses that you leave behind. Make sure that your life insurance policy is large enough to cover any debt that you have. Calculate any student loans, house payments, etc. that you have, or will have in the future.
Ultimately, your specific health, familial, and budget needs are going to determine what your ideal policy should look like. The best life insurance is going to protect you financially, fit within your budget, and support your long-term goals. Life insurance for diabetics is not impossible to find – like any other product or service, getting the best policy at the cheapest rates requires a bit of research, diligence, and time.
The life insurance purchasing process can be long and frustrating, but it doesn’t have to be. Don’t spend hours on the phone answering the same questions over and over. We can save you all that time with representatives and give you the best quotes for you in a matter of seconds.
Life insurance is not one of the most exciting or fun policies you will buy, but it’s the most important. Every year there are millions of families that are left with thousands of dollars of debt that they can’t pay for. Life insurance gives you and your family the protection and peace of mind that they deserve.