Reader Question: Life insurance for Diabetics
I've got Type 1 Diabetes and have been trying to find the best life insurance for diabetics. But I'm struggling to find the answers as there's a lot of conflicting information out there. First up can I even get Life cover with diabetes? If so what's the best and most cost effective way to keep the premiums down?
Thank you in advance
Response:
The answer to this is probably, but maybe not!
Type 1 Diabetes is usually controlled by Insulin injections, and tends to occur in younger people (under 40). In reality it isn't necessarily the Diabetes that is the issue, but more the health issues that can arise from it. These include increased risk of Heart disease or Stroke, and problems with the Eyes, Kidneys, Nerves, Teeth & Skin
Whether or not you can get life insurance will depend upon several factors
- How well controlled the disease is.
- Your current Age
- The term of cover you require, more specifically the age you will be when it ceases. The younger the better of course
- Family history, particularly relating to Diabetes
- Your blood pressure, if it is raised then this goes against you
- Your current Height & Weight, the closer your Body Mass Index (BMI) is to “Normal” the better
- Whether you smoke?
What you'll need
Before making an application you should have to hand the following information:
- Your latest HbA1c reading, and date of the reading. This may also be referred to as your Glycated Haemoglobin level or Haemoglobin A1c. Note this is different to your Blood Glucose level reading. A HbA1c reading of less than 48 mmol/mol (or 6.5%) is regarded as well controlled.
- details of any complications that you already suffer from
- details of any medication or treatment you are having for the Diabetes, or Diabetes linked ailments.
Medical Loading on life insurance for diabetics
Unfortunately with such a wide variety of factors to be considered you will only know the final outcome once a full Underwriting process takes place. This will include contacting your GP for more information.
Once this has been finalised the life company's underwriters will likely offer terms that include a medical loading to the monthly life insurance premium of anything from PLUS 75% to PLUS 200% or maybe even more. This means they increase the normal premium by 75% to 200%. In the most severe situations you will be Declined (that is that they will refuse to offer you life insurance because of your diabetes)
For example a normal policy might cost someone without Diabetes £20 per month. The same person with a loading for Diabetes of 100% would mean a premium of around £40, and a 150% loading around £50. You'll notice I say around rather an exact number, as it is usually a £1 or two different.
Real Case Study - Life insurance for diabetics success story
A 45 year old client applied for life cover, and stated they had Type 1 Diabetes, which was diagnosed around 20 years ago. His Height & Weight give him a “normal” BMI (body mass index), he doesn't smoke and his Blood Pressure is within the normal range. He confirmed that there is no adverse family history relating to Diabetes, his condition is well controlled, and there are no additional complications.
The insurance company underwriter was able to confirm all of the information through his GP and were then prepared to offer him terms of +125%. This would raise a “normal” premium of £20, up to £45. The client was happy to proceed on that basis, as he had already been advised that this was the likely outcome.
What if I can't afford it?
It should be noted that if the premium offered is outside of your affordable budget you could then ask for the level of cover to be reduced to match your budget.
For example, let's assume you have applied for £200,000 of cover and your maximum budget is £50 per month. The “normal” premium might be £30, and so with a 50% loading you would be in budget at £45.
However, after medical underwriting the loading ends up being larger, and they decide plus 150% is appropriate. This would put the premium at around £75, considerably higher than your budget. You could then ask them to reduce the cover to around £135,000, which would be around £50 per month. In this way at least you have some cover, rather than none. If you bear in mind that the reason they are loading the premium is because there is a greater risk that you will actually claim then it is definitely the case that you probably need the cover!
I hope that helps
Best Wishes
Darren Amos
Financial Planning Designer
If you would like to contact Darren to find out more about life insurance with diabetes or utilise his expertise in finding the best life insurance for diabetics then you can contact him via the red box (either to the right of or below this article depending on the device you are using).
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