Securing Life Insurance with Pre-existing Conditions

Your Comprehensive Guide To Getting Coverage

LIFE INSURANCE IS A CRUCIAL FINANCIAL SAFEGUARD

Life insurance provides financial security, not for yourself, but for the family you leave behind.

Year over year, funeral expenses are on the rise, with Life insurance is an important financial safeguard that can provide peace of mind and financial security for your loved ones in the event of your passing. However, obtaining life insurance can feel more difficult if you have pre-existing health conditions, are currently unwell, or have a medical history that may affect underwriting.

The good news is that having a pre-existing condition does not automatically mean you cannot get covered. There are still options available, and working with an independent agency like American Eagle Insurance Agency can help you better understand which type of policy may fit your needs.

FUNERAL FACTS: Many families are not financially prepared for the cost of a funeral, burial, cremation, cemetery expenses, transportation, flowers, and other final arrangements.

UNDERSTANDING YOUR FINAL EXPENSE LIFE INSURANCE OPTIONS

Final expense life insurance is designed to help your loved ones cover funeral costs, burial expenses, cremation, medical bills, and other final arrangements. These policies are usually smaller than traditional life insurance policies, which can make them more affordable for people who only need enough coverage to help with end-of-life expenses.

The amount of coverage you choose is called the face value of the policy. For example, someone may choose a $5,000, $10,000, $15,000, or $25,000 policy depending on their needs and budget. In many cases, choosing a lower face value can help lower the monthly premium.

Level Benefit Final Expense Life Insurance

A level benefit policy may be available to applicants who are in relatively stable health. With this type of policy, the full death benefit is usually available from the beginning of the policy, as long as the application is approved and premiums are paid.

This option may offer the strongest coverage, but it may require answering health questions. It is usually a better fit for someone whose health conditions are well-managed or not considered too high-risk by the insurance carrier.

Graded Benefit Final Expense Life Insurance

A graded benefit policy may be an option for people with more serious health conditions. With this type of policy, the full death benefit may not be available right away. Instead, the benefit may increase over time, often during the first two or three years.

This can still be a helpful option for people who may not qualify for level benefit coverage but still want to put some protection in place for their family.

Modified Benefit Final Expense Life Insurance

A modified benefit policy is another option for higher-risk applicants. These policies may have a waiting period before the full death benefit is available. If the insured passes away during the waiting period, the policy may return the premiums paid plus interest instead of paying the full benefit.

While this type of policy may have more limitations, it can provide a path to coverage for people who may otherwise have difficulty qualifying.

Guaranteed Issue Final Expense Life Insurance

Guaranteed issue life insurance is available to most applicants and typically does not require a medical exam or detailed health questions. This can be helpful for individuals with serious pre-existing conditions or those who have been declined elsewhere.

However, guaranteed issue policies often come with lower coverage amounts, higher premiums, and waiting periods before full benefits are available. Because of this, it is usually best to review other options first before choosing guaranteed issue coverage.

Choosing the Right Face Value

Not everyone needs a large life insurance policy. Some people simply want enough coverage to help their family avoid paying funeral and final expenses out of pocket.

A smaller final expense policy may be a practical option for someone who wants coverage but needs to keep the monthly premium affordable. The right amount depends on your budget, your final wishes, and what costs you want the policy to help cover.

STRATEGIES FOR SECURING COVERAGE

Work with an Insurance Agency

American Eagle Insurance Agency works with multiple insurance carriers, which allows us to help compare options based on your health, budget, and coverage needs. Instead of being limited to one company, we can help look for a policy that may be better suited to your specific situation.

Be Honest About Your Health

Transparency is key when applying for life insurance. It is important to answer health questions honestly because insurance carriers may review medical records, prescription history, and other underwriting information.

If inaccurate information is provided and the insured passes away during the contestability period, the insurance company may investigate the claim. This could delay payment or result in a denied claim, leaving loved ones responsible for final expenses.

Show Evidence of Stable Health

If your condition is being treated, managed, or has improved over time, it may help to provide medical records or details about your treatment plan. Evidence of stable health, regular doctor visits, and medication compliance may strengthen your application.

Consider Waiting Period or Graded Benefit Policies

For higher-risk applicants, some insurers may offer policies with a waiting period or graded benefit. This means the full death benefit may not be available right away, but coverage can still provide a path toward protection.

FINANCIAL FACTS: Funeral home payment plans may seem helpful at first, but they can leave grieving families with another monthly bill during an already difficult time.

Important Considerations

Premiums for individuals with pre-existing conditions may be higher because insurance companies view certain health conditions as increased risk. However, the type of condition, severity, treatment history, age, lifestyle, and overall health can all affect the options available. The most important thing is to explore your options before assuming you cannot qualify.

Final Thoughts

Securing life insurance when you are sick, disabled, or living with a pre-existing condition may seem overwhelming, but it is not impossible. There are different types of policies available, and some may be designed specifically for individuals who have had difficulty qualifying elsewhere.

By being honest about your health, understanding your options, and working with the insurance professionals at American Eagle Insurance Agency, you can improve your chances of finding coverage that helps protect your loved ones when they need it most.

Get started by filling out the form below.

What is Life Insurance?

Life insurance is a contract between you and an insurance company to pay a lump sum of money to a beneficiary upon your death for a set monthly premium.

 

Life insurance protects your family by providing financial support and security in the event of your death. Here's how it works:

 

1. Financial Security for Your Family: When someone passes away, it's hard for the family to both grieve and pay for final expenses. Most of our clients also want to leave a legacy for their family such as providing the ability to buy or pay off a house, paying for car or college for their grand kids or leaving something for their spouse. 

2. Income Replacement: If you are the primary breadwinner in your family, your death could create a significant financial burden. Life insurance can replace your lost income, ensuring that your family can continue to meet their day-to-day living expenses, pay bills, and maintain their quality of life.

3. Debt Coverage: Life insurance can be used to pay off outstanding debts, such as a mortgage, credit card debt, or personal loans. This prevents your family from being burdened with financial obligations they may struggle to manage on their own.

4. Education and Future Expenses: The death benefit can be used to fund your children's education, including college tuition. It can also cover future expenses, like weddings or starting a business, helping your family achieve their goals.

5. Funeral and Final Expenses: Have you ever had to come up with thousands of dollars within a few days?  This is what families have to do everyday when someone dies.  They have to quickly figure out how to pay for the loss of a loved one. Life insurance can cover the costs associated with your funeral and other final expenses, relieving your family from these financial burdens during a difficult time.

6. Estate Planning: Life insurance can play a crucial role in estate planning, ensuring a smooth transfer of assets to your heirs and minimizing potential estate taxes.

7. Peace of Mind: Having life insurance provides peace of mind, knowing that your family will be financially protected if the unexpected happens. It can help reduce anxiety about their future financial well-being.

 

In summary, life insurance serves as a safety net for your family. It ensures that they have the financial resources they need to maintain their quality of life and achieve their long-term goals, even in your absence. It's a valuable tool for safeguarding your family's future and well-being.

Why do I need life insurance?

We get this question everyday.  You don't need it - your family needs it.  If you haven't had to directly deal with someone's death then consider yourself lucky. It is a devastating event that happens when you least expect it.  But maybe you do expect it, maybe your loved one is sick for a long time and you know that it will happen one day.  You can't wait to get sick to get life insurance because at that point it will be too late.  If you're like the millions of Americans who have cancer and heart issues that run in your family, don't "think" about getting life insurance, get life insurance today. 

Do I have to get a physical exam?

There are life insurance carriers that require medical exams however our agency focuses on those policies and those carriers that do not require medical exams.

Do I have to pay up front?

No, you pay for your policy when you want it to become active after it has undergone the underwriting process. Typically speaking, underwriting can take 10 to 14 days to complete and for your application to become approved. You decide on what date your life insurance premium will come out of your account and you decide moving forward, what day of the month your life insurance premium comes out of your account.

How do I apply for life insurance?

A life insurance applications can be done over the phone, in person or online. They take about 15 to 20 minutes depending on the length of the application. You can sign your application document in person or through your email with an e-signature process.

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