Life Insurance After Cancer : What Are My Options?

Cancer is one of the hardest diseases to deal with both mentally and physically, and people who overcome cancer often wonder if they can obtain life insurance after cancer. When people go through the process of battling such a horrible disease it really puts into perspective what matters most to them, and normally it’s their family. It makes you think what would happen if you weren’t there for your family, and the importance life insurance in your financial plan.

Life insurance isn’t something most people think about until they actually need it, but the availability of life insurance is based on age and health. Cancer can impact your ability to obtain life insurance, but it is still possible to purchase life insurance after your cancer is gone, and sometimes while you still have it, depending on a variety of factors.

Is Life Insurance After Cancer Realistic For You?

Cancer is such a broad topic, and the disease has such varying degrees of severity which makes it impossible to make a generalization whether it’s possible to obtain life insurance coverage after it. In many cases, the premium you will pay for life insurance is based on whether you have been cured, or if the probability of a cure is high.

A cancer such as non-melanoma skin cancer may not have any affect on your life insurance premiums, and I have seen someone with a history of skin cancer obtain the best life insurance ratings.

Certain cancers which can be cured when detected early such as prostate, testicular, thyroid, and breast cancer may be able to obtain the “standard” life insurance rating after they have been cancer free for a period of time. This period of time differs depending on the life insurance company.

Other cancers, which are considered “high risk”, such as colon cancer or a history of leukemia would be likely to receive a rated life insurance policy, and also have a possibility of decline.

Waiting Periods

The majority of life insurance carriers we work with will not issue a life insurance policy for someone who is undergoing cancer treatment. If you apply for coverage and the company rates you for a history of cancer, it may be possible to receive a rate reduction after a certain period of time being cancer free.

The common wait period (although some companies will differ) which companies require you to be cancer free before applying for life insurance is 5 years. It is important to note, if you do have life insurance before you are diagnosed with cancer you are able to keep this particular coverage in force. Cancer, or any other disease, will not cause your current life insurance to be voided.

Obtaining A Policy

One of the key factors in obtaining life insurance after cancer is to work with a cancer life insurance specialist, who is an independent life insurance agent. For example, when we receive an inquiry from someone with a history of cancer we have a specific set of questions which need to be asked. Your answer to these questions will guide us to which life insurance companies will be the most advantageous to work with in getting you affordable life insurance coverage.

Having access to over 50 life insurance companies allows us to pair you with the right life insurance company, and reduce the probability of getting declined. The worst thing you can do, other than not applying, is to apply with the wrong company and get a decline for life insurance on your record. This will not look favorably when applying with other companies. It’s important to apply the right way, the first time around.

The type of cancer you have, and the severity will help determine which types of life insurance are available. Obviously those types of cancer with shorter life expectancy will be harder to insure than a type of cancer with a higher chance of a cure. If you have cancer and are looking for life insurance your most likely only option will be guaranteed issue life insurance policy or a graded life insurance policy.

Guaranteed Issue Life Insurance

If you currently have cancer, than you will not be able to qualify for traditionally underwritten life insurance policy. The cancer obviously poses a significant risk to the life insurance company. A risk they will not be able to cover. This leaves your best option of coverage to guaranteed issue life insurance.

Guaranteed issue life insurance is pretty much what the name says it is. A guaranteed issue product will not have the applicant undergo any type of medical underwriting. This included medical exam and medical questions. Because of the lack of underwriting it means someone who has cancer will be able to apply for a life insurance policy.

Some of the drawbacks of guaranteed issue include a much higher premium, and low face amounts. Because of the lack of underwriting, these policies cost significantly more. Life insurance companies also issue these policies at low face amounts, generally between $1,000-$25,000. We could possibly apply for more than one company if you desire more coverage.

Graded Life Insurance

Another option if you are wondering, can you get life insurance if you have cancer, is graded life insurance. Graded life insurance is a guaranteed issue life insurance policy with a few stipulations.

The main difference between graded life insurance and guaranteed issue life insurance is when you receive full life insurance coverage. A graded life insurance policy will have stipulations such as you will only receive premiums (plus interest) back if you die in the first few years of this policy. The amount of years varies per company, but two to three years is a pretty average amount of time. Once you live past these first few years, you then have coverage for the full death benefit. This is a way for the life insurance company to hedge its risk in writing a guaranteed issue life insurance policy.

A graded life insurance may also award a certain percentage of the death benefit in the first few years of policy. Either way this policy works, it is important you and your beneficiaries understand how, and when, this policy will pay out. It is important you understand you are entering into this type of contract, and beneficiaries understand the terms so you don’t ever have them fighting with the life insurance company if something were to happen.

Graded life insurance also does come at a significantly higher premium than a traditional policy, since the life insurance company is taking on significant risk. Graded life insurance policies also come with limitations on how much coverage will be issued.

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