High-Risk Life Insurance: What Are My Options?

In this article...
  • Health problems and other risk factors can make buying life insurance challenging, but it's often possible. Find out about high-risk life insurance options.

If you have serious health problems or other lifestyle-related risk factors, you may be worrying about whether you can get life insurance. Understanding your high-risk life insurance options can help you find affordable coverage and choose the best policy for your circumstances. 

Who Is a High-Risk Life Insurance Candidate?

When you apply for life insurance, the company will estimate the risk of selling you a policy. In a nutshell, you're considered a high-risk life insurance applicant if the insurer thinks you're more likely to die early in your policy or during the policy's term. 

There are various reasons a life insurance company may consider you a high-risk applicant, including:

  • Working in a risky occupation
  • Preexisting health problems
  • Unhealthy lifestyle choices, such as smoking
  • Dangerous hobbies

Health and High-Risk Life Insurance

If you currently have a serious health condition or have a history of serious health problems, insurance companies are more likely to consider you a high risk. These include:

  • Dementia
  • Stroke
  • Cancer
  • Heart attack or heart disease
  • COPD
  • HIV

However, life insurance companies assess each candidate on a case-by-case basis, so they'll consider factors, such as your prognosis and the severity of your condition. For example, an insurer may consider your risk to be lower if you comply with an effective, physician-prescribed treatment program and are in otherwise good health. Meanwhile, someone else with the same condition may be considered high-risk if they don't follow their treatment program or have other risk factors. 

Lifestyle and High-Risk Life Insurance

Various lifestyle choices can make you a high-risk life insurance candidate, including smoking, obesity and excessive alcohol consumption. However, your job and hobbies can also cause companies to view you as risky to insure. 

If you work in a high-risk industry, life insurance companies may charge higher premiums because of an increased risk of premature death. For example, working in the logging, fishing or mining industries could all affect your life insurance rate, although this depends on the risks involved in your specific role. Participating in dangerous hobbies, such as skydiving and motorcycle racing, can also limit your life insurance options. 

How Do Companies Determine Who Is a High-Risk Life Insurance Applicant?

Generally, all life insurance applications go through a process known as underwriting. During underwriting, the company will consider your overall health, age, occupation and lifestyle to determine your risk level and assign you a life insurance rate. The underwriters may use various evidence sources to reach a decision, including:

  • Medical records
  • Health and lifestyle questionnaires
  • Medical examinations
  • RX reports (prescription drug records)

The standard rate is the baseline for all life insurance applicants, and you'll likely receive this rate if you have minor health issues or a mildly risky occupation or hobby. Low-risk applicants could receive a preferred or super-preferred rate. These rates typically provide access to the most policy options and the lowest monthly premiums. If the company decides you're risky to insure, you may receive a table rating. This is more likely if you have significant risk factors, such as a dangerous occupation or serious underlying health conditions. 

Can I Get Life Insurance as a High-Risk Applicant?

Generally, most high-risk applicants will have at least some life insurance options available to them. Typically, companies may limit the policies you can access or charge significantly higher premiums to mitigate the risks of insuring you. Occasionally, having a very low table rating may mean that you can only get guaranteed issue life insurance, which is much more expensive than most other coverage types. 

If you're struggling to find affordable life insurance that provides adequate coverage, it could be worth using an insurance agent with expertise in handling high-risk applications. These agents can usually help you determine which companies are most likely to cover you and can suggest ways to present your case as positively as possible. 

High-Risk Life Insurance: What Are My Options?

The life insurance options available to you depend on the company and how risky it would be to insure you. Generally, the following types of life insurance may be suitable, although a low table rate may make some of them inaccessible. Before deciding, it's worth comparing quotes for several insurers and policy types to help you get the best deal. You could also consider purchasing through a company specializing in high-risk life insurance policies. 

Term Life Insurance

Term life insurance covers you for a set period, generally between 10 and 30 years. These policies are usually the cheapest option because they don't pay interest, and your coverage ends with the term. Most policies charge level, predictable premiums and pay a guaranteed death benefit if you die before the policy ends. 

Some insurers will issue term life insurance policies to high-risk applicants on a case-by-case basis, and it could be the best option if you don't need permanent coverage but require a higher death benefit. However, you'll usually pay significantly higher premiums than those with fewer risk factors. 

Permanent Life Insurance

Permanent life insurance covers you for your whole life and builds cash value. Therefore, it's a suitable option for people who need a retirement income source or have life-long financial dependents. As you might expect, premiums for permanent life insurance policies are usually higher than for term policies. 

Whether an insurance company will extend you permanent life insurance as a high-risk applicant depends on its policies and the underwriting results. If the company believes you're likely to pass away before making significant premium contributions, it may charge higher premiums or even refuse to grant coverage. 

Group Life Insurance

Group life insurance could be a good option if you're an employee and struggle to get regular term or permanent life insurance. Many employers offer discounted or free group life insurance as part of their employees' benefits packages. As the insurer covers a group, there are no health or lifestyle eligibility criteria — making group life insurance suitable for even the highest-risk applicants. 

However, there are drawbacks to relying on group life insurance as your only coverage. Typically, death benefits are limited to $50,000 or around twice your yearly income, which may not be enough for your family's security. On the other hand, group life insurance is better than no coverage and significantly more affordable than guaranteed issue life insurance. 

Guaranteed Issue Life Insurance

Companies offering guaranteed issue life insurance will accept any eligible applicant, regardless of health and lifestyle risk factors. However, most companies set age restrictions on these policies, typically offering them to applicants aged between 50 and 80.

As guaranteed issue policies don't involve health or lifestyle underwriting, they're significantly more expensive than traditional insurance and only tend to offer death benefits of up to $25,000. Furthermore, your beneficiaries may not receive a death benefit if you die within 2 to 3 years after purchase. For that reason, guaranteed issue life insurance is a last resort for many applicants, so it's worth checking out other options first. 

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