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Best life insurance for those with a mental health history

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As with any other medical condition, receiving a mental health diagnosis can cause many to worry about their chances of finding a life insurance company to extend them 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?

How mental health impacts life insurance

When shopping for life insurance, both your mental and physical health will typically be evaluated. This is done initially by answering specific questions on the application. While question format varies by company, you can generally 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 a mental health condition 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.

How mental health history impact coverage

Although each application is evaluated on an individual basis, keep the following in mind to understand the impact mental health history could have on coverage eligibility:

When coverage might be more expensive When coverage might be denied
New or several past mental health-related hospitalizations History of attempted suicide
Diagnosed with a mental health condition that has higher rates of suicide, such as anxiety or depression You fail to disclose mental health treatments
Unable to work due to mental health conditions, such as depression If you were hospitalized within the last year for mental health conditions

Fortunately, it is possible to purchase life insurance after a mental health diagnosis. By following prescribed treatment plans and remaining under the care of a psychiatrist and physician, it is possible to improve your coverage classification. Maintaining a positive employment history is another way to improve chances of obtaining a policy or better premiums.

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 may 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

Written by
Mandy Sleight
Insurance Contributor
Mandy Sleight has been a licensed insurance agent since 2005. She has three years of experience writing for insurance websites such as Bankrate, MoneyGeek and The Simple Dollar. Mandy writes about auto, homeowners, renters, life insurance, disability and supplemental insurance products.
Edited by
Insurance Editor