It’s a common misconception that having a pre-existing condition means that you automatically do not qualify for life insurance. The good news is this is not always the case. Armed with a good life insurance agent, many individuals with pre-existing conditions get approved for insurance. The path to becoming insured just may look a little different for someone with a medical condition.
What You Need to Know
- Work with a Broker
There are many life insurance carriers in Canada and each company has a different set of underwriting guidelines and level of flexibility. It is crucial to reach out to a number of companies when trying to get a pre-existing condition covered. Working with a broker is the most efficient way to research companies, as most life insurance brokers have the ability to work with multiple companies. This also means they will have knowledge of which companies may work best for hard-to-insure clients.
- Understand Traditional Underwriting vs Non-Medical Underwriting
Many companies now offer non-medical underwriting. This usually means that applicants will be asked a number of medical questions, and if the questions satisfy the insurance company, then the insurance will be approved. If they don’t, the application will be rejected. This can work in the favor of someone with a pre-existing condition if the questions either:
- do not ask bout that particular condition
- the question asked about that condition is forgiving (example: you are diabetic but the application only asked if you are an insulin dependent diabetic).
However, sometimes traditional underwriting can be the best option for someone with a pre-existing condition. Traditional underwriting can allow you the opportunity to make a case for a well-managed pre-existing condition through in person exams and doctors statements. If the applicant doesn’t qualify for non-medical insurance because of a condition, there is usually no wiggle room with the insurer.
- Manageable Condition vs Severe Condition
Not all pre-existing conditions are treated the same by insurers. Life insurance companies put each applicant through an underwriting process that uses in person medical exams, claim histories, and underwriting guides to determine whether or not they will insure someone. There is a big difference to an insurance company between someone with a manageable condition and someone with a severe condition.
For example, having high blood pressure is considered to be a pre-existing condition. However, it is a condition that can often be managed by medication and lifestyle choices. Therefore, an insurer may look at someone with high blood pressure, and determine that their condition is well under control and be willing to make an offer to insure.
Conversely, someone who has been diagnosed with a terminal cancer would be considered to have a severe and unmanageable condition that would likely cause the insurer to reject the application.
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