By James Tobin
LIHD Difficulty Rating
While there is a lot to know about getting approved for life insurance with clinical depression, the eight questions below are an excellent start. For more in-depth discussion just follow the links in the answer sections and keep reading.
Every applicant for life insurance with depression can be approved for a policy.
However, the type of policy that can be approved, and the rates charged, will depend on the nature of your depression( major clinical depression or Seasonal Affective Disorder), your treatment, and your overall health.
Because the underwriting standards are different for each type of policy, this review of life insurance options after a stroke is broken into three sections: (click link to go directly to section)
In order to underwrite your application life insurance carriers will need to know the symptoms that you have experienced, the date of diagnosis, the treatment undergone, including prescription drugs used, and any medical follow up. For a more exhaustive discussion of the underwriting of applications for life insurance with depression, please scroll to What Life Insurers Will Take Into Consideration
In order to get the best rates possible you may need to take an exam. term policies will be available with no exam for mild SAD cases. However, clinical or major depression applications will require an axam for the best term policies.
If it turns out that simplified issue or guaranteed issue policies are the best fit for your application, no exam will be required. Click here for more information on the exam.
The rates you pay for tem insurance are dependent on the underwriting class you are graded by the carrier. Depression applications likely ratings are generally going to be as standard or lower. This issue is discussed using pricing samples here. Sample pricing for simplified issue and guaranteed issue policies is provided in the corresponding links.
The quotes you receive from the quote tool on this site are 100% accurate for the information inputted. That is to say, if you get the rate class correct- your rate will be correct. The problem with online tools is that people generally think they are inn better or worse shape than is reality.
If you are unsure about rate class you should choose a range and hope to be pleasantly surprised. Alternatively, you can fill out the customized quote form and we will get in touch with you as soon as possible.
The most effective ways to improve your life insurance rating are to use an agent that has access to the companies that will view you most favorably and to take care of your health.
See Why to use Independent Agent when Shopping for Life Insurance with Depression? to better understand the reason to use an independent agent.
As far as lifestyle goes, if you take diet and exercise seriously along with limiting alcohol and quitting smoking (if you smoke), it should be reflected in your blood markers.
if you have a medical condition like depression, documenting compliance with medical advise and any medications is very important. Obtaining Having a physicians letter stating that you have been compliant and improving is helpful.
do these things and you can't help but improve your health and your life insurance rating.
Life insurance companies have differing appetites for specific risks. These appetites are reflected in underwriting and ultimately pricing. Simplified issue carriers will be state dependent and three of the better known term carriers for dealing with depression are Prudential, American General (AIG), and Banner.
However, risk appetite can, and does, change and the only way to guarantee the best possible deal is to work with an experienced independent agent. see the case study here to get a clear understanding.
The life general insurance application process is an eight step process that includes choosing your terms, picking a carrier, submitting to the exam, and signing documents (digital signatures accepted). The entire 8 step process is laid out for you here.
For a more in-depth description of the process with respect to depression see Obtaining life insurance with depression.
Whether you're dealing with seasonal affective disorder (S.A.D.) or more serious clinical depression, you know about the everyday challenges that you face. What you may not know is that obtaining life insurance with depression will also have it's challenges.
While it is not uncommon to see mild depression applications receive standard or better ratings, it is unlikely that an offer for life insurance will not be rated as substandard. However, the severity of the rating can vary significantly, therefore it's important that you use an agent that is experienced with depression cases and has access to the carriers most likely to be receptive.
Primarily, term life insurance is available for lengths ranging from 5 years to 30 years with 20-year terms being the most popular. Term policies usually have a minimum face amount of $50000, and the policies terminate at the end of the term period or can be renewed annually at a vastly increased rate.
Things to Know About Term Insurance
In addition to the period of insurance, it is essential to understand the available policy riders. Riders are additional benefits that, often for an additional cost, are included in your policy.
The five most prominent riders are listed below with links to in-depth descriptions.
While there is no waiting period for the insurance to go into effect, the insurance company has a two-year window from the policy start in which they can contest a benefit for material misrepresentation on the initial application. So, honesty is the best policy.
You can dive deep into the ins and outs of term life insurance, learning about available term lengths, riders, financial ratings, and rates. The Life Insurance Help Desk works with the top term life insurance carriers.
When applying for life insurance with depression, or any other condition, underwriters will generally be concerned with some basic questions:
While the outline above is general in form , the questions will require specific answers. These answers will be gathered from your application, a telephone interview, the Medical Information Bureau, a Script Check, and an attending physicians statement (APS).
Lets look at the general areas of inquiry one at a time.
Due to the myriad contributors to depression, other than scrutinizing drug and alcohol use, this is not a factor.
The reason it matters with most conditions is that underwriters are more comfortable with making offers when an applicant fits into a common pattern. If the condition doesn't fit, there as a real possibility that something else is at play. When this is the case, underwriters will try to allay their fears by taking a harder look at the file.
Underwriting will want to know the symptoms you had (if any) and how long you had them before the diagnosis.
Below, from the National Institutes of Health is is a list of some of the signs and symptoms that major depression is afoot:
Persistent sad, anxious, or “empty” mood
Loss of interest or pleasure in hobbies and activities
Decreased energy or fatigue
Moving or talking more slowly
Feeling restless or having trouble sitting still
Difficulty concentrating, remembering, or making decisions
Difficulty sleeping, early-morning awakening, or oversleeping
Appetite and/or weight changes
Thoughts of death or suicide, or suicide attempts
Life insurance underwriters will want to know the date of first diagnosis and of any subsequent major flare-ups. Underwriting will also want to know what medications you have been prescribed for depression.
A quick look as WebMD list the following drugs commonly prescribed for depression:
To see a list of names (brand & generic) of drugs that fall into these categories please see WebMD.
While information that is "foggy" will be taken from your medical records, knowing the dates of diagnosis and treatments is necessary to get an accurate quote for life insurance with depression.
For Life insurance with depression, underwriters will want to see that you have been compliant with prescription medication and any follow up requirements including doctors appointments.
In addition to taking prescription medications, dietary simprovement and supplementation are often encouraged by physicians. For a brief write up of homeopathic suggestions see Dr. Lissa Rankin's article in Psychology Today.
While any application for life insurance with depression will take into consideration your overall health including conditions like high cholesterol and gout, underwriters in depression cases will specifically look for certain related conditions.
Among the related conditions of special concern to underwriters are
For a full discussion of related orders (not necessarily of concern to underwriting visit Anxiety and Depression Association.
The term life insurance market is quickly adopting accelerated underwriting programs that do not require a medical exam as part of the application process. The accelerated "no exam" protocol will be available for mild SAD applicants. However, these no exam or non-med policies will not be available if you have had a diagnosis of major clinical depression.
Without the no exam option, you will be required to take a para-medical exam. The exam is usually a 15-20 minute meeting with a nurse. Your exam will consist of a blood draw, a urine sample, and height and weight recorded.
Because each case is different, the following pricing scenarios are the best estimates based on experience.
Best Case – If Depression is mild, symptoms are under excellent control and there is good compliance, some cases have a chance for a standard rating. Simply use the quoter on the left for a standard quote.
Mid Case –If your Depression seems to be mild with only the use of moderate antidepressant pharmaceuticals and good compliance you may be looking at a mid substandard rate. You calculate this rate by multiplying the standard rate by 1.5 (Table 2/B) or 2 (Table 4/D).
To learn about how table ratings work click here.
Severe Case – If your Depression symptoms are severe and you have a need for chronic maintenance drugs and/or you have a history that includes suicide attemps/thoughts, , the best you will likely do is a severe substandard rate. You calculate this rate by multiplying the standard rate by 3 (table 8/H).
* while expensive this is still a very good outcome for the circumstances
Decline– For a severe case you may be declined for traditional coverage. If this is the case you may be eligible for a smaller face amount policy. These policies are referred to as Guaranteed issue or simplified issue. If you have been declined please contact us.
At the top of this article we stated that any body can be approved for affordable life insurance with depression. Note, however, we mention “affordable” rather than inexpensive or “low cost’. The reason for the distinction is that life insurance with a depression history is not cheap life insurance.
Often times, because the coverage can be expensive on a per benefit dollar basis, the benefit is reduced to make the life insurance affordable. While this is often not an ideal situation, the truth is we all have to live within our budgets, and sometimes the way to make life insurance after a stroke affordable is to reduce either the term of coverage or the benefit amount.
The difficult part of term life insurance with a history of depression is finding the best deal. This is because different carriers have differing appetites for certain kinds of risks. As a result navigating this process is not as easy as using a quote tool and picking the lowest price. This is discussed in detail in the case study below...
$250000 10 Year Term
$500000 20 Year Term
$200000 20 Year Term
$100000 10 Year Term
Now you already understand that your story matters, and that two people in similar situations can get very different offers from the same carrier.
What you might not know is that different insurance companies will also treat each case differently.
For example Lincoln Financial may have more of an appetite for the risk that life insurance with depression presents than say AIG. In this case the underwriting grade will reflect this increased appetite.
So, if your Agent only represented one carrier and you found out later that that you could have gotten a rate 35% or 45% better, how would you feel?
You’d probably be mad either at the agent or yourself or both. So it’s important that your Agent represent multiple carriers.
In fact a good independent agent will have access to over 50 carriers. This ensures the best chance at a good rate.
Note, that if he doesn’t, he may not be in a such hurry to let you in on this info.
So, I have been preaching about the importance of using an independent Agent and you may think that sounds a bit self serving coming from an independent agent.
You’re right, it is. However, it is also the (provable) truth.
Please see the case study below . it will show why it is in your interest to have as many options as possible available when shopping for life insurance with Depression or any other impairment.
Gender: Male Age: 45
$500000 20 Year Term
Controlled Depression Diagnosed Age 39
Uses 2 RX No Other Health Concerns
This looks like a best case scenario that could be either standard or Table 2/B or 4/D depending on the insurers appetite for a Depression risk.. Let’s take a look at the rates.
Life Insurance Company
Life Insurance Company
Life Insurance Company
*Rates as of 12/10/2016
This table which shows only a few of the major life insurance companies available illustrates the difference in rates. For standard rates Assurity is 33% more expensive than Protective.
On it’s face this seems like a pretty straight forward choice and if underwriting grades between carriers is the same, it really can be that simple.
This kind of easy price shopping is particularly useful for younger folks in good health and demonstrates why you want to use an independent Agent.
For people who suffer from Depression or any other serious diagnosis, it gets much more complicated.
Because life insurers manage their appetite for specific risks by being more lenient or more stringent with underwriting grades, you need to know which company will grade you a standard or table 2 risk and which ons will grade you as table 4-6.
In the case above Prudential (the second most expensive standard rate) is likely to be the best deal because the more competitively priced carriers will likely rate the risk table 2/ 4 while Pru might well go standard.
This is something you can’t know by simply looking at the lowest price. In this case using an independent agent could save you 38% (the difference between Prudential @ standard and Banner @ Table 4).
With a couple of caveats, the process of obtaining life insurance with depression is essentially the same as for any other condition.
The primary caveats with major depression are that no exam or so called “non-med” policies will only be available in very small face amounts and an attending physician's statement (APS) is guaranteed to be requested.
The APS can slow the process as doctors are seldom in a hurry to respond to requests from life insurance companies.
The information that you will be required to provide in order to get the most accurate quote is as follows:
Date of Diagnosis
Age at Diagnosis
Treatments Undergone- This will require a list of any pharmaceutical drugs being taken as well as any recent prescription changes.
Dates of Treatments-This will include any hospitalizations as well as evidence of compliance.
Severity of Symptoms
Other Health Issues
Because applications for life insurance with depression are evaluated on a case by case basis, your story always matters. That is to say two people with the same age and condition may get vastly different offers from the same carrier based on age of diagnosis and patient compliance.
Key Take Aways
$25000 "Final Expense" Whole Life 1st Day Coverage
$15000 "Final Expense" Whole Life 1st Day Coverage
$15000 Final Expense" Whole Life Graded Coverage
$10000 "Final Expense" Whole Life Graded Coverage
Many burial policy insurers will have 10-15 minute home office interviews using the telephone. They are looking for the use of prescriptions that do not come up on their prescription check and assessing cognitive function. Be alert!
There are fewer riders associated with simplified issue policies than traditional term, but living benefits such as the accelerated benefit for terminal illness, and chronic illness are fairly common. Additionally, some final expense policies have a small cash component and have loan provisions.
The contestability laws are the same for all types of life insurance policies. That is, the carrier has two years from the origination of the policy to contest the benefit payout on policy where the application contained material misstatements.
As stated before, simplified underwriting is unconcerned with strokes. Unlike traditional underwriting that grades on a scale, "final expense" is a yes or no proposition.
Note that "yes" is divided into first-day coverage and "graded" categories. Depression offers are generally "level day one" unless there are other serious health concerns.
With regard to other impairments, underwriting will want to know if there are any and what they are. Such impairments that limit activities of daily living or ADL's ( eating,bathing, dressing, and toileting, transferring & continence), require home health care or nursing rehab. These issues may force a waiting period or outright decline.
Final expense policies contain "knockout" questions and prescriptions. Depression medications in most cases will not knock you out of 1st day coverage.
Because most final expense underwriting rules differ wildly, it's unusual that you can just go to the final expense quote tool and start. However, unless you have other serious conditions, that is exactly how to start.
Because depression is not usually an issue with final expense carriers, the best price may win. Remember to use the quote tool on the "final expense" page. The quote tool on this page is limited to term quotes.
Upon receiving your quote request, we will be in touch as soon as possible (often in minutes), and we will help you through the process. The whole process shouldn't take more than 30-40 minutes.
We are committed to a transparent pricing process and are happy to share a computer screen with you or send a video of the method used to get your rate. If you have any questions, please contact us.
As a stand-alone condition, depression not require the use of guaranteed life insurance. However, if the only offers are "graded", it may make sense to use a guaranteed policy until the 1 or 2 year period passes and you become eligible for day one coverage.
Additionally, if you are physically impaired due to additional conditions and require home health care, or nursing facility, you will likely require guaranteed life insurance
If this describes your situation, keep reading.
Guaranteed policies should only be used as a last resort. In addition to the benefit grading provisions that make the policies toothless during the two or three year grading period, they are the most expensive policies sold.
Male Monthly Rates
Female Monthly Rates
With only the requirement of age (depends on the carrier) and citizenship, guaranteed issue life insurance policies have a death benefit that ranges from $5000-$50000. Such plans are exclusively whole life insurance.
However, all guaranteed issue policies are "graded". Generally, the grading represents a 2 or 3 year period that the policy must be in force before a full death benefit will be paid.
Like "final expense" policies, guaranteed policies use a two or three year period in which the benefit increases to the face amount over the contractual time period. These policies commonly pay only premiums plus interest if you die if you die before the end of the "grading" period. (2-3 years depending on carrier). After the grading period ends, the carrier would pay the full face amount.
Also, like the "final expense" write up says, these provisions are a way for the carriers to provide coverage while limiting their risk.
There is no exam for guaranteed life insurance. After all, it's guaranteed to be issued regardless of your health.
Although the contestability laws are the same as other policies, beyond age and citizenship, it's difficult to see where contestability may arise in a guaranteed issue case.
Now that you know the information you will need to receive the most accurate quote possible, it’s time to gather the information and speak to an independent Agent (raising my hand).
We are committed to totally transparent pricing (we’ll even share our computer screen with you if you’d like), and making the application process as painless as possible.
Simply give us a call or shoot an email over and we can get you started.
Thank you for reading about life insurance with depression, if you have any questions, We’d like to hear them.
The Mayo Clinic defines depression as “ a mood disorder that causes a persistent feeling of sadness and loss of interest.
Clinical or “major” depression isn't a weakness and you can't simply "snap out" of it. More than just a bout of the blues, depression may require long-term treatment.
Depression affects how you feel, think and behave and can lead to a variety of emotional and physical problems. It can cause trouble doing normal day-to-day activities.
The world of manic depression is a world of bad judgment calls"
Keywords & related questions
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Jim Tobin is the owner of Life Insurance Help Desk, a Fairfield County, CT. life insurance agency. You can find him on LinkedIn and Facebook. Over the past 10 years, Jim has used his CFP-financial planning designation to help individuals with their life insurance needs. In addition to working with life insurance clients, Jim teaches ESL classes in his spare time. He resides with his beautiful wife Nicole and the 3 cats that rule their lives..
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