Finding life insurance for parents that have been diagnosed with cancer can be challenging but not entirely impossible. If you’ve been cancer free for 5 years or more there is a good chance you will could find a policy but there are a few things you should know before you apply.
Can Parents with Cancer Get a Life Insurance Policy?
The answer to this question is not a simple yes or no. The correct answer is maybe, but it won’t be easy. Some websites are claiming “approval within 24 hours for cancer patients” or, “Instant approval, no medical questions asked.” Don’t believe them! The truth is, these websites are giving people false hope.
Maybe if you are looking for a $5,000 burial policy there could be no medical questions or approval within 24 hours, but if you are looking for more coverage, you are going to have to provide a lot more background information. In order for an insurer to offer a policy to cancer survivors, the company will want to assess their risk before approval.
Insurance Companies will want to know:
- When was your first treatment?
- Treatments you had for your cancer
- What type of cancer?
- Where was your cancer?
- Grade or stage of cancer
- Are you in remission?
- How long have you been in remission?
- Have you experienced any relapses?
- Last treatment date
The key for a cancer survivor to successfully getting an affordable policy is to work with someone who specializes in high risk cases. In other words, an agent that is an impaired risk specialist.
Impaired Risk Specialist For Parents With Cancer
The agent or broker who insures your home or auto is probably not the best choice to help you find a policy if you’ve had a recent bout with cancer. Even your life insurance agent might not be a good choice if he or she does not specialize in high risk cases.
Most agents are generalists and try to be everything to everyone and wind up not specializing in anything at all.
If you really don’t want to waste your time, you need to work with an agent that knows which insurance company will offer the best quote for your situation
Impaired-risk specialists are insurance brokers or agents who know which insurance companies are going to offer the most competitively priced policies for health conditions such as cancer, heart disease or even diabetes.
If you’ve been cancer free for 5 years or more, the insurance policy and price you get will be based on the curability of your cancer. For instance, certain types of cancer such as non-melanoma skin cancer is considered a low risk by some life insurance companies. Even if you have or had a history of skin cancer, you could receive a preferred rate!
Insurance Ratings For Cancer
All life insurance policies come with industry standard of ratings. They are based on many factors such as health, lifestyle, pre-existing conditions, prescriptions, driving record and even credit ratings.
The higher the rating, the better risk you are to the insurance company and the premium will be lower. Simply put, the insurance company feels your risk of dying is low. However, if you’ve had cancer, there is a higher risk that the cancer could return or you will probably die sooner than someone who has never had cancer.
Insurance companies use these ratings to determine risk:
• Top class or preferred plus
• Standard Plus
• Substandard risks with classes 1 through 9
Many insurers will not even consider making an offer or giving a policy to a person who is still undergoing treatment for cancer. However, depending on your type of cancer, the life insurer might add a surcharge or a “flat extra.” The surcharge could be temporary and could be removed over time.
How Insurance Companies View Parents with Cancer
Most insurers use information from National Cancer Institute’s database called “SEER” (Surveillance, Epidemiology, and End Results) This database compares reports on previous cancer patients. Cancer specialists, medical scientists and doctors provide data which insurance companies use for underwriting.
These findings give insurers statistics which they use to come up with risk ratings for particular types of cancer, treatment and survival rate. Parents with treatable forms of cancer such as thyroid, prostrate and breast cancer could reasonable expect to be approved for a policy with a standard rating.
Certain types of cancer such as lung, colon or leukemia would be classified substandard or most likely declined.
What Types Of Policies Are Available?
Any type of life insurance policy is available for parents with cancer – if you can qualify. Here is a quick overview of the policies:
Increasing Term Insurance
This is the most cost effective policy if you are young. The policy rate is based on your current age and the rate or cost increases as you get older. These policies have durations to age 75, 80 or 85.
Unfortunately, as you get older, increasing term becomes very expensive because as you age, there is more risk of dying. Most people who buy this type of policy keep for a few years while they are young and then if they still need coverage, will opt for a new policy will level premiums.
This policy is the most affordable long term because it is temporary coverage. If you qualify, you can get a term policy where your rates are guaranteed level for a specific period of time. Term policies are available for 10, 15, 20, 25 or 30 years.
Permanent Life Insurance
Permanent insurance such as whole life or universal life will last your entire lifetime as long as you pay your premiums. However, it is more expensive than term life and if you can afford it, whole life may be the best fit for a parent who has been diagnosed with cancer.
Note: These policies also come with a rider feature called the “Accelerated Death Benefit” which allows you access a portion of your death benefit if you become critically ill.
Graded Death Policies
Graded Death Policies are also known as Guaranteed Issued Policies and are specifically designed for people with serious health problems.
These policies have a 2 year wait period before any death benefit will be paid. After the wait period the death benefit equals the amount of premiums paid and a credited interest rate. There is little or no underwriting with Graded policies and the premium charged is based on your age and gender.
I’m ready to try to get coverage. What’s Next?
If you are ready to try to get a life insurance policy, you can simply contact us or call: 914-633-1717 during normal business hours. An impaired risk specialist will ask you some basic questions and provide you with information about getting started.