Life Insurance After Stroke
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By James Tobin, CFP®
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Expert Review Of Life Insurance After Stroke
Jim Tobin, CFP®
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While there is a lot to know about getting approved for life insurance after a stroke, the seven questions below are a good start. For more in-depth discussion just follow the links in the answer sections and keep reading.
Can I Be Approved For Life Insurance After A Stroke?
It’s completely possible to be approved for an insurance policy even with a history of stroke.
But the policy type and premiums will be determined by how severe your stroke was (CVA or TIA) when it took place, and your general state of health.
Since underwriting standards tend to be different among insurance companies for their policies even when it’s for the same condition, we’ve divided this review into three separate sections – simply click on the corresponding link for jumping to the relevant section.
What Information Will Life Insurance Companies Want To Know?
Insurance company underwriters will request information about the date of your first stroke, the treatments you’ve taken, the prescription medications you’ve used, and follow-up reports. Underwriters will also analyze your health markers, such as your cholesterol, blood pressure, and weight levels, and ask you to submit information regarding treatments, prescriptions, procedures, and instances of work disability claims or hospitalizations resulting due to the condition.
In order to evaluate the risk your stroke history poses to the carrier, underwriters will need to know the following Information:
- What was the date of your stroke?
- Was the stroke a TIA (transient ischemic attack) or a full CVA (cerebrovascular accident) stroke?
- What studies or test were conducted after the stroke? This would include MRI,CT Scan, ultrasound.
- Symptoms at time of stroke.
- Do you have any residual effects from the stroke?
- What Medications are you taking as a result of the stroke?
- How is your health other than the stroke history? This will particularly be concerned with related condition to stroke such as high blood pressure, high cholesterol, diabetes, and smoking.
Life insurance underwriters will also seek information regarding any dangerous hobbies or work activities you engage in, and information about potential alcohol or drug abuse. Your driving record will also be thoroughly scrutinized.
Also known as ‘simplified issue’ policies, these policies can be purchased without undergoing an exam. You will be asked to submit information regarding certain important dates and medication but nothing more. Although they are significantly pricier than conventional policies, they have extremely lenient with their terms.
Will I Need To Take An Exam For Stroke Life Insurance?
To purchase and be approved for a term insurance policy after a stroke, you’ll have to undergo a medical examination, regardless of the actual severity of your stroke.
However, if you’ve recently completed an EKG-cardiac workup test, you can submit the results of the test. In such a case, you’ll only have to undergo a paramedical examination that involves an analysis of your urine and blood samples, which will be collected by a traveling nurse at zero additional costs.
But if your last cardiac workup was more than six months ago, you’ll be required to undergo an EKG test or even a stress test if the policy offers a substantially large amount of benefits.
Guaranteed issue or simplified issue insurance policies are ideal for someone who doesn’t want to undergo an examination. All you need to do is submit an application, answer a few questions, and provide a detailed medical and prescription history to be approved for the policy.
How Will A Stroke Or TIA Mini Stroke Affect My Life Insurance Rates?
TermYour term insurance rates will be entirely influenced by what underwriting category you’re assigned by your insurance carrier. Applicants with a history of stroke tend to be assigned a standard or lower rating.
Final expense insurance policies are of two types – graded policies or ‘no waiting period’ policies. In the case of the former, the policy beneficiaries cannot claim the policy benefits unless the death occurs at least two years from the date of approval of the policy. We’ve provided sample pricing details for guaranteed issue and simplified issue policies for readers who are interested in learning more about them.
how Accurate Are The Stroke Life Insurance Quotes I Get From Your Quote Tool?
The insurance quotes generated by our site’s quote tool are completely accurate for the data provided. However, most people mess up in this aspect and enter the wrong data, causing the quote tool to generate the wrong quotes.
If you’re too unsure about which rate class you fall into, you can simply select a range of values and receive a result that will be close to the actual quote.
You can also complete and submit our customized quote form. We’ll reach out to you at the earliest to discuss your insurance options.
What Are The Best Life Insurance Companies For Stroke Survivors?
Different life insurance firms employ different underwriting standards for certain conditions. You can find more information about their policies by going through their underwriting and pricing terms. If you’re an applicant with a history of stroke, you can go for a policy from Banner, AIG, or Prudential, which offer the best terms to applicants with a history of strokes.
However, companies do change their risk appetite for certain conditions regularly. The best way to obtain an affordable and value-for-money option is by working with an independent agent who has access to different companies. Check out our case study here if you’d like to learn more.
Most burial insurance carriers have lenient underwriting policies with many of them offering ‘Day 1’ insurance coverage, provided at least 1 year has elapsed since the last CVA stroke. The waiting period can be completely done away with if it was a TIA stroke. But since burial insurance carriers may not always be available in your state, it is important that you select one that offers you favorable terms.
What Is The Application Process For Life Insurance After A Stroke?
The process for obtaining term life insurance happens to be an 8-step process, which involves selecting your insurance terms, your carrier, undergoing a medical examination, and submitting necessary documents. More information can be obtained here.
Final ExpenseBurial insurance applications get processed at a much faster rate. Since it’s a short application, the policy will be underwritten within minutes without the need for an examination.
Traditional Term Life Insurance After A Stroke
Although applicants with a history of CVA strokes don’t usually qualify for anything more than table rated or substandard offers, the rating’s severity may be extremely different. Therefore, it’s crucial that you make use of the services of an agent experienced in handling cardiac cases with ample access to different insurance carriers.
Term life insurance policies have a minimum face value of around $50,000 and get terminated when the policy term draws to an end, which may range between 5 – 30 years. You can also renew them, though this is not recommended since the costs are likely to be extremely high.
Likely Underwriting Classification After A Stroke
Life insurance applications are individually scrutinized by underwriters to learn better what kind of risk they’re taking on. If you present your story properly, you may be able to get a better deal from the underwriter compared to someone else in similar circumstances who did a poor job at presenting his application. Your compliance reports and time elapsed since the last event will also count tremendously.
We’ve presented the following premium pricing scenarios, based on our own experience in the industry. However, remember that the preferred and preferred plus underwriting categories are not awarded to any applicant with a history of strokes.
Standard class- If you’re a stroke patient who’s in the clear regarding everything else, you may be able to qualify for a standard rating. TIA strokes carry significantly fewer penalties compared to CVA strokes.
Provided the last stroke took place 6 years ago and was only a TIA event, you may be able to bag a standard rating if you don’t have any other significant medical conditions. The standard rating is still possible for people with a history of CVA strokes; however, they’re just far more unlikely.
Sub-Standard Rate- If your application is not awarded a standard rating, you’ll be given a substandard or table-rated insurance quote. With each table, the premiums increase by around 25%. This means that Table 2/B costs 1.5x times the standard premium rate. This may hit a maximum of 4x times the standard premium rates if you have significant shortcomings.
Any applications submitted by people whose last TIA stroke was less than six months ago or whose last CVA stroke was less than 1 year ago will not be considered.
Decline- If your condition is too serious and you suffer from other complications like high BP, cholesterol, weight, or smoking levels, your application may be rejected. However, you can still go for a simplified issue and guaranteed issue policies, which come with lower policy benefits.
If your life insurance application has already been declined, we caution against reapplying without the aid of an experienced independent insurance agent. Information about such declinations is accessible to all insurance companies via the Medical Information Bureau, which may significantly affect your future applications – something you definitely don’t want.
Pricing For Term Life Insurance
Right at the start, we promised that every person could obtain affordable life insurance even if they had a history of stroke. However, there’s a major difference between ‘low-cost’ or ‘inexpensive’ and ‘affordable’. While most people use them interchangeably, that’s not always correct.
Since having a medical condition can cause your premiums to be raised many times over, the only way to keep them affordable is by slashing either the benefits or the policy term period. Yes, it’s not ideal but it’s the best course of action we have. Life insurance on a budget means settling for slightly unfavorable terms.
In such cases, you can improve your odds of getting better terms by working with an insurance agent who has ties to numerous companies and not just one company. An experienced independent agent will have contacts in the industry who help provide you with policies with favorable terms. If you’re someone suffering from a complicated medical condition or history, we strongly suggest using an independent agent’s services. A more detailed explanation has been provided in the study below:
Case Study For Life Insurance After Stroke
- Male Age: 50
- $250000 20 Year Term
- Tobacco: No
- TIA Stroke at age 42
- Statin Use
- Table 2/B
- Table 4/D
Life Insurance Company
Life Insurance Company
Life Insurance Company
This table provides information about some of the biggest life insurance companies and their premium pricing policies. In the standard category, Prudential happens to be 20% costlier compared to Lincoln.
While it might seem like a no-brainer to choose the latter, this is only applicable for applicants who have been assigned the same rating by both carriers. Only healthy, young applicants with no black marks on their medical record typically qualify for such policies.
However, people with a serious medical condition or a history of strokes may find it to be a complicated affair. Since companies have different risk appetites for the same condition, a stroke survivor may find himself being assigned a standard rating by one company whereas another might offer him only a substandard rating. The trick lies in finding out which insurance carrier will give you the most favorable terms and subsequently applying only to those carriers.
And who better to guide you through this process than an experienced independent agent who has ties to different companies? They can help you save on a lot of time and resources by matching you up immediately with companies that offer generous terms for people with your condition.
In this example, Prudential is the best option despite having the most expensive standard premiums since the other carriers are likely to simply give your application a table-rated offer whereas Prudential will offer a Standard rating. Lincoln @ Table 2 costs around $170.29 per month, which is 50% more than Prudential @ Standard. Over the course of a 20-year policy, that translates into a difference of $18,134.
Final Expense Burial Insurance After A Stroke
Burial insurance or final expense carriers have different terms for CVA and TIA strokes. Since the latter is milder in nature, you can obtain better options and even Day 1 coverage policies without any waiting period whereas you may not be so lucky if your stroke was CVA.
But if your stroke had taken place over 2 years ago, or even 1 year ago in some cases, underwriters will not penalize your application for it.
No-exam burial insurance policies are ideal for people who are unlikely to score traditional policies due to serious medical conditions.
Final expense insurance policies are ideal for people who wish to prevent their families from taking a financial hit due to their burial, funeral, and other costs when they pass away. Such policies take care of your funeral needs and prevent their families from being overly burdened with financial expenses. They can also be used to leave some kind of inheritance for the family.
Simplified issue policies are great for people who are unable to obtain traditional term insurance but are in desperate need of life insurance. Since they have more lenient underwriting standards, they allow people with even a problematic medical history to obtain coverage.
Such policies are of two types:
- Graded coverage
- First-day coverage
How Final Expense Life Insurance Works With A Stroke History
With the death benefits ranging between $5000 - $100,000, people seeking final expense or simplified issue policies generally tend to go for whole life insurance products. However, there several policies that have components of term policies starting to emerge. Make sure you know what you are buying!
Be it a whole or term life insurance policy, the death benefits ultimately come down to whether it’s a graded policy or a policy with first-day coverage.
Graded policies have a 2 – 3-year waiting period, in which the benefits are gradually increased to the face value.
First-day insurance policies offer full death benefits and start coverage from the first day of the insurance policy.
Graded policies tend to pay out premiums paid + interest if the death takes place within the policy’s first year. Beneficiaries may be paid 30% – 50% of the policy if death takes place between 1 – 2 years of the date of the issue. After two years, the beneficiaries are eligible to receive full face value.
Whether it’s a graded policy or not, all whole life insurance policies have fixed premiums that cannot be increased. The policy remains in effect until the death of the insured or cessation of payment of premiums.
Pricing For Burial Insurance After A Stroke
Complex underwriting standards notwithstanding, final expense pricing tends to be more complicated since most providers are only operational in certain US states.
This means pricing samples may not be all that useful. You can check out our final expense quote tool to learn more.
Guaranteed Life Insurance For Stroke
If your stroke took place less than 1 year ago, it doesn’t mean your only choice is to use a guaranteed life insurance policy. But if you’re only qualifying for graded offers, you may be better off obtaining guaranteed insurance policies until the 1 – 2 years of waiting period is over, upon which you’ll be eligible to obtain Day 1 coverage.
People who suffer from physical impairments due to their stroke and in need of home nursing may be better off with a guaranteed issue life insurance policy.
Why You Should Use An Independent Agent When Shopping For Life Insurance After A Stroke
Apart from showing how you can obtain life insurance even with a history of strokes, you have also learned how different companies have vastly different underwriting and pricing standards. It all comes down to the company’s risk appetite, which is mostly influenced by internal policies.
For instance, Prudential Financial may have more lenient terms in place for stroke patients compared to Banner. However, if your agent only represented Banner, that would mean that you’d be overpaying for your insurance despite there being a cheaper option.
An independent agent usually represents well over 40 – 50 carriers, thus ensuring you’ll always have access to the best possible insurance deals at affordable rates.
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Bonus: The 5 most common mistakes people make buying life insurance and how to avoid them