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Best life insurance for those with a mental health history

Updated Mar 14, 2024

According to the National Alliance on Mental Illness (NAMI), roughly 57.8 million individuals in the U.S. live with a mental health condition. If you are one of them, you may have been denied life insurance due to mental health in the past. Having a mental health condition may make it more challenging to find life insurance, but it's not impossible. Bankrate took a careful look at how insurers go about determining who they will write policies for and what you can do to find life insurance for bipolar disorders or other mental conditions.

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This advertising widget is powered by HomeInsurance.com, a licensed insurance producer (NPN: 8781838) and a corporate affiliate of Bankrate. HomeInsurance.com LLC services are only available in states where it is licensed and insurance coverage through HomeInsurance.com may not be available in all states. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.

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What is the best life insurance for those with a mental health condition?

There are different types of life insurance, and some may be better options than others for those with mental health conditions. However, there are other factors that also play a significant role in determining your best choice for coverage — such as your budget and the length of time you need coverage for. Everyone's circumstances are different, so you may want to shop around before you settle on a policy type or carrier. You may also find it helpful to work with a licensed life insurance agent or broker who can answer your questions and help you find an insurer who is more likely to write you a policy despite any mental health challenges.

  • Term life insurance: Term life insurance offers coverage for a set period, usually between 10 and 30 years. This type of coverage is generally cheaper than other types of life insurance, particularly if you are younger and generally healthy.
  • Permanent life insurance: As the name implies, permanent life insurance is a type of life insurance that lasts your entire life as long as you pay the premiums. It is usually more expensive than term life insurance, so it might not be the best option for everyone. Permanent life insurance, such as whole life insurance or universal life insurance, offers a cash value component.
  • Guaranteed issue life insurance: Guaranteed issue life insurance might be one of the best life insurance options for those with mental health conditions to consider. There is guaranteed approval and no medical exam to qualify. However, the available death benefits are typically capped around $25,000-$50,000, and this type is often more expensive than other life insurance policies.
  • Group life insurance: Group life insurance is offered by employers through the workplace. These policies are often inexpensive and easy to obtain, and generally do not require any medical underwriting to qualify. While obtaining coverage is generally easier than with other policy types, the policy only remains active for as long as you maintain employment with your company.

What is considered a mental health condition in life insurance?

A mental health condition is one that “affects a person’s thinking, feeling, behavior or mood,” per NAMI. Those with a mental illness can oftentimes feel alone, yet it is estimated that one in five U.S. adults live with a mental illness. Although the mental health conditions considered by life insurance companies vary from carrier to carrier, if you have been diagnosed with any of the following mental health conditions, it may impact your premium and potentially your ability to purchase life insurance:

  • Anxiety disorders
  • Depression
  • 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 does mental health impact life insurance?

When shopping for life insurance, both your mental and physical health will typically be evaluated. Depending on the carrier and type of life insurance policy, you may have to fill out a health questionnaire or participate in a medical exam. Some common questions you may see on a questionnaire include: 

  • 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 substance abuse, may result in higher premiums than other mental illnesses, lower coverage limits available or even application denial. 

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.

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, the underwriter will need to conduct an investigation to gather more information about the discrepancies found and it could lengthen the application process.

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 during that time for misrepresentation. If it finds you lied on the application, your beneficiary may not get the full death benefit you selected. They might get a reduced amount based on what your premiums would have qualified you for with accurate representation or they may only get the premiums paid into the policy up to your death.

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Written by
Mary Van Keuren
Contributor, Insurance

Mary Van Keuren has written for insurance domains such as Bankrate, Coverage.com, and The Simple Dollar for the past five years, specializing in home and auto insurance. She has also written extensively for consumer websites including Reviews.com and Slumber Yard. Prior to that, she worked as a writer in academia for several decades.

Edited by Editor II, Insurance