Receiving a mental health diagnosis can cause many to worry about their chances of finding a life insurance company that will provide them with coverage. While your health history can be a factor used to determine your eligibility and premium, having a mental health condition does not automatically mean you will be denied coverage.
In fact, there are many factors used to determine your eligibility, similar to homeowners and auto insurance. If you have a mental health history and are looking for life coverage, it may take a bit more time and documentation, but you could still be approved with an affordable rate. Just like other health conditions, how you manage your condition and the severity are key to securing a life policy.
What qualifies as a mental health condition?
According to the National Alliance on Mental Illness, a mental health condition is one that “affects a person’s thinking, feeling, behavior or mood.” Mental illness sufferers can oftentimes feel alone, yet 50% of lifetime mental health conditions present by age 14 and 75% by the age of 24.
Being diagnosed and treated for any of the following mental health conditions could affect life insurance:
- Anxiety disorders
- Attention Deficit Hyperactivity Disorder (ADHD)
- Bipolar Disorder
- Borderline Personality Disorder (BPD)
- Dissociative Disorders
- Eating disorders
- Obsessive-Compulsive Disorder (OCD)
- Post-traumatic Stress Disorder (PTSD)
- Psychosis
- Schizoaffective Disorder
- Schizophrenia
How mental health impacts life insurance
When shopping for life insurance, part of the underwriting process is to evaluate both your mental and physical health. This is done initially by answering specific questions on the application. While question format varies by company, you can expect questions like:
- When were you diagnosed with your mental health condition?
- What severity is your mental health diagnosis (mild to severe)?
- Have you been hospitalized for it in the last 12 months?
- What is the frequency of your episodes and when was the last one?
- Do your symptoms affect your ability to perform daily living tasks?
- Do you currently have a treatment plan and are you following it?
Certain mental health conditions that have a higher likelihood of suicide such as severe anxiety or depression, schizophrenia and OCD, may result in higher premiums than other mental illnesses.
Seeing a mental health professional may help increase your chances of being approved for life insurance at a better rate, especially if you are following the treatment plan, have not been hospitalized recently and have a consistent employment history.
Guaranteed issue life insurance
If your mental health diagnosis causes you to be declined for coverage, you do have another option. Guaranteed issue life insurance is a type of whole life insurance that, generally speaking, does not require health questions or a medical exam.
You will have to answer a few basic personal questions, which are no different than the basic form for standard life insurance. With a guaranteed issue policy, you will most likely get instant approval and can keep the policy as long as you pay the premiums.
Not all companies offer guaranteed issue life insurance and most cap coverage at $25,000 or $50,000. Since guaranteed issue is whole life insurance, it is often more expensive. And because there is no health assessment, rates for this type of coverage can be the most expensive because they are on a high-risk basis.
What happens if I lie about my mental health diagnosis?
You should never lie about anything on the application, including a mental health diagnosis. Life insurance underwriters use databases like the Medical Information Bureau (MIB) to confirm the medical history information you supplied. If it is found you lied on the application, it is considered insurance fraud and could carry serious consequences. Lying is also disclosed to the MIB, which can be found by other insurance companies if you apply for coverage in the future.
Most life policies, including term life insurance, have a two year suicide clause. This clause is in place to prevent people from purchasing life insurance with the intent to commit suicide and have their family’s income protected. Companies also include a contestability clause for the first two or three years of the policy.
This clause allows the company to investigate any death claim for misrepresentation. If it finds you lied on the application, your beneficiary may not get your death benefit. There is a chance they could get the premiums paid into the policy up to your death, but would lose out on the death benefit you paid for.
Frequently asked questions
Can someone with bipolar disorder get life insurance?
Yes, you can get life insurance with bipolar disorder. You will have to answer some additional health questions specific to your mental health condition, including if your illness is under control and for how long. Underwriters also consider factors such as hospitalization history, treatment plan and occupational and social functioning to determine if you are approved and at what rate.
What disqualifies you from getting life insurance?
There are several things that can cause life insurance denial. Lying on the application, not meeting age or health requirements, having a pre-existing condition like cancer or heart disease, being a high-risk driver and even applying for too much insurance can disqualify you for coverage.
Can you be denied life insurance for anxiety?
Yes, if your anxiety is not being well-managed and is affecting your ability to participate in life and hold down a job, you could be denied for life insurance. However, if you are following your doctor’s treatment plan and are managing your anxiety appropriately, you should qualify for life insurance. If you are otherwise healthy, you may even qualify for some of the best life insurance rates, depending on the company and its underwriting guidelines.
How do insurance companies know if you have a pre-existing condition?
When you apply for life insurance, you must sign the application in order for it to be reviewed for coverage. When you sign the application, you agree to have your medical records reviewed by the underwriters, unless you choose a guaranteed issue life policy. Even if you apply for coverage without a medical exam, your doctor’s records and MIB profile will still be checked before an offer of coverage is extended by the company.
Can I get life insurance if I have PTSD?
Someone diagnosed with Post Traumatic Stress Disorder, or PTSD, can likely get approved for life insurance. Just like with other mental health conditions, an underwriter will review your medical history and answers to the health questions on your application.
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