Diabetic and looking for final expense insurance?
It can be a confusing topic, so lets set the record straight.
In this article, we are going to explore how final expense companies respond to diabetes, what options you’ll have, and how to find the best policy for you.
The Best Final Expense Options For Diabetics
Make no mistake, you can get a final expense policy when you have diabetes.
There are options no matter what!
Understand that what options you’ll have depend entirely on the details of your health.
That said, there are three basic policies you may qualify for when you’re a diabetic:
- Level Benefit Plan
- Partial Coverage Plan
- ROP Plan
Level Benefit Plan
Any insurance company who approves you for their level plan means you qualified for the lowest rate they offer along with immediate coverage.
A level benefit means there is not a two-year waiting period.
The insurance company is on the hook for all the risk starting on day one of your policy.
Partial Coverage Plan
Some companies will approve you for a policy that offers some coverage during the first two years rather than making you wait a full two years before it protects you.
Generally, partial coverage plans will payout 25%-40% during the first year and 70%-80% during the second year.
After two years, the full amount would be payable for any reason. Also, any partial coverage plan would carry a higher monthly premium.
Any ROP (return of premium) plan means that you have a full waiting period during the first 2-3 years of the policy.
During the waiting period, the insurance company will not cut a check for the death benefit if the insured passes away. Instead, you’ll just receive a check for all the premiums you’ve paid plus interest.
The only way the policy would payout during the waiting period would be because of accidental death. In addition to the waiting period, you will also have a higher monthly payment.
How Burial Insurance Companies Underwrite Diabetes
First of all, you will not be required to take a physical or medical exam.
Final expense life insurance never requires an exam.
To qualify, all you will need to do is answer some basic questions about your health.
In addition to health questions, the insurance company will analyze all the prescriptions you’ve filled because that gives them a very clear picture of what health issues you’ve had.
Every burial insurance company underwrites differently. Another way of saying that would be to say they all accept and reject different health conditions.
Therefore, they will all respond to diabetes in their unique way.
Here are the primary concerns most companies will have when it comes to diabetes:
1. When Did You First Become Diabetic?
Most companies will have a question that clarifies if you had diabetes before age 50, age 40, age 30, etc.
If you were diabetic before age 30, some companies will still accept you, but not many.
2. Do You Have Any Complications?
Every insurance company will clarify if you’ve had any diabetic complications such as:
- neuropathy (nerve damage in your feet and legs)
- nephropathy (kidney damage)
- retinopathy (eye damage)
- insulin shock
- diabetic coma, or
Recent events such as amputations, insulin shock or diabetic comas will be a decline.
You’ll need to be two years or more out from those events before you can qualify with some companies.
Permanent complications like neuropathy or retinopathy are accepted by a couple of companies, but not many.
Kidney issues from diabetes will always result in a higher premium and a waiting period.
3. Do You Take Insulin?
Many final expense companies will have a threshold of daily insulin use. Some have limits such as 30 or 40 units daily.
Again, every carrier is unique regarding their limits (if they have a limit).
Many companies don’t have a unit limit so it’s not too difficult to find coverage when you use insulin.
4. What’s Your Height and Weight?
Nearly all companies will have what’s called a build chart.
These charts are height-to-weight ratio guidelines.
Essentially it means the carrier limits how much you can weigh based on your height. If you exceed their limit, it could result in a higher premium and/or a decline.
Final expense companies have very liberal build charts.
You will need to be anywhere from 250-300 pounds (varies based on your height) before your build becomes an issue with most carriers.
5. Do You Have Other Health Issues?
As is the case with all life insurance, all your health issues (not just diabetes) will come into play.
The summary of your health history will ultimately be what determines which companies you can apply with.
While there may be companies that are perfectly fine with your diabetes, you may have other issues that prevent you from qualifying.
At the end of the day, you’ll want to try to find a company whereby you can say no to all their health questions. Doing so would mean you’re eligible for their lowest premium and coverage that has no waiting period.
Understand that it may or may not be possible to find a company where you can say no to everything.
It just depends on the details of your unique situation.
For example, if you experienced insulin shock five months ago, there is no carrier that you could apply with where that event would not require a yes answer.
As with all health issues, time is a big factor regarding your eligibility.
When you experienced an event determines how it will impact you.
Top 5 Companies That Will Approve Diabetics
As mentioned above, every carrier has different underwriting guidelines when it comes to diabetes.
Below is a list of companies that offer coverage to diabetics along with where they are strong and weak when it comes to diabetes issues.
1. Mutual of Omaha
Mutual of Omaha is great for insulin users. They currently have no limit on daily units.
At any point in your life, diabetic coma, insulin shock or amputations are all declines.
If you were diabetic before age 50, they’ll offer you their graded plan which is not a plan you should buy.
2. Royal Neighbors of America
Royal Neighbors of America does not have a limit on insulin usage (as long as it was after age 30) and they freely accept applicants with diabetic neuropathy or retinopathy (very rare).
Insulin shock, comas, or amputations are all declines at any point in your life.
Americo is yet another good carrier for anyone using insulin; they also have no daily limit.
They will not accept any sort of complication at any point. They don’t have an age requirement, so it does not matter when you developed diabetes.
Even if you were first diabetic at age 15, they are okay with it.
4. American Amicable
American Amicable says they have no daily insulin limit, however, insulin before age 50 is a decline.
If you’ve ever had any complications from diabetes, they are not a good company to go with.
They’ll either decline you or give you a high premium and waiting period.
AIG has a plan which is guaranteed acceptance, so your health is not a factor.
If you’ve had major issues with your diabetes or just have a lot of other very high-risk health issues, they’re a great option.
They will not decline anyone for any medical reason.
Sometimes, there is no company with underwriting that you can qualify with. That’s when AIG shines bright.
They have a very competitively priced guaranteed issue policy relative to the other options out there.
Also, they are the only no health question plan that offers two free riders on their policy.
How To Find The Best Policy For You
There are dozens of funeral insurance companies to choose from, and they all have different rates and underwriting.
So how do you know which one is best for you?
Here’s how you do it…
Consult an Independent Broker
They will gather information about your health so they can determine how each insurance company will respond to your health issues.
Then they’ll run price quotes for you to see which one has the best deal for you.
It can be hard putting your trust in someone else, but in this case, you have to.
As the consumer, there is no way you can determine how each company will respond to ALL your health issues. Only an agent can do that.
Don’t want to talk to an agent?
If you want to never talk to someone (even though their job is nothing more than helping you find what you’re looking for) your only option would be to purchase a guaranteed acceptance policy that has no health questions.
Those will always cost much more because they’re taking on more risk since they know nothing about your health.
Also, there is always going to be a two-year waiting period before you’re insured.
Again, they know nothing about your health, so the waiting period is what prevents people on hospice care from buying a policy and collecting a big check a month later.
Here’s the Bottom Line
If you want to pay the least and have coverage that starts right away, you have to work with an agent.
Just make sure it’s an independent agent who represents at least 10 or more life insurance companies.
As long as you do that, you give yourself the best chance at finding the best diabetic policy possible.