In today’s world, we are increasingly aware of the challenges that affect our mental health. Many of us experience mental health conditions ourselves or know someone close to us who does.
The difficulties of day-to-day life can cause significant anxiety about what the future holds. We’ve discussed parental existential crisis and money dysmorphia, both of which may stem from poor mental health and can certainly cause mental health problems if left unaddressed.
Hence, I conducted some research on life insurance applicants with mental health conditions.
Years ago, I had a personal experience where I was denied an affordable policy after seeing a sleep doctor in 2015 for my snoring. The doctor charged my insurance company $3,600 for a sleep study, which concluded I had heavy sleep apnea. As a result, when it was time to renew my 10-year term life insurance policy, the monthly premium rate I was offered was 12 times higher ($40 vs. $480)!
Apply For Life Insurance Before Seeing A Doctor
My conclusion from this ordeal is to always get a life insurance policy before seeing a doctor for any non-life-threatening illness. Once you lock in an affordable life insurance policy, preferably for 30 years at around age 30, you can then address any medical concerns.
Similarly, it is best to secure an affordable life insurance policy before seeing a doctor or therapist for any mental health issues. Mental health conditions can directly impact life insurance pricing and eligibility. The degree of impact varies based on several factors such as the applicant’s diagnosis or multiple diagnoses, medication(s), treatment history, age, and overall physical health.
The good news is that well-documented, regular treatment for certain mental illnesses can result in ample life insurance coverage at competitive rates.
In this post, I’ll go through the following topics:
- Reviewing the various mental health conditions
- How mental health conditions impact life insurance coverage
- How much life insurance may cost with a mental health condition
- The best life insurance providers for those with mental health conditions
- Tips when applying for life insurance with a mental health condition
What Are Mental Health Conditions?
First of all, let’s clarify what mental health conditions are. Also known as mental illnesses, they encompass a wide range of health issues or daily life challenges that impact one’s emotional well-being, thoughts, and behaviors. These conditions can manifest in various symptoms such as anxiety, stress, depression, phobias, and more.
Many individuals and families are affected by mental health conditions today. Ninety percent of Americans rightfully believe we’re in the midst of a mental health crisis and the facts back this up. The White House reported in 2024 that two in five adults report experiencing anxiety or depression. This rises to roughly half of young adults, who also sadly suffer from suicide as their leading cause of death.
In addition, less than half of all adults with a mental illness diagnosis are getting the care they need. Even more troubling are the 70% of children who need mental health care but can’t get it.
With the ever increasing importance of mental wellbeing, let’s take an extensive look at how mental health comes into play when securing a life insurance policy.
Related: Mental Illness Deserves A Sick Day Just Like A Physical Illness
Most insurance carriers will not deny coverage to applicants with pre-existing mental health diagnoses. However, some mental health conditions can directly affect the cost of life insurance resulting in higher premiums. In particular, life insurance policies for individuals with schizophrenia or bipolar disorder tend to be more expensive. They carry a higher insurance risk for the carrier especially if an applicant is not undergoing regular treatment.
However, in many cases consumers with mental health conditions can access competitive rates with consistent treatment history. Also, due to the prevalence of mental health illnesses today, life insurance providers are accustomed to evaluating applications from individuals with mental health histories.
Which conditions do life insurance companies typically look for when determining pricing and reviewing applications? Carriers often closely examine diagnoses that require medication. They may also consider if and how an applicant’s ability to work and day-to-day life are affected.
Here are several examples of mental health conditions that can impact pricing for life insurance coverage, and possibly eligibility as well:
- Depression
- Anxiety
- Bipolar Disorder
- Post-Traumatic Stress Disorder (PTSD)
- Schizophrenia
- Schizoaffective Disorder
- Psychosis
- Obsessive Compulsive Disorder (OCD)
- Eating Disorders
- Dissociative Disorders
- Borderline Personality Disorder
- Attention Deficit Hyperactivity Disorder (ADHD)
Related reading: The Mental to Physical Connection For A Healthier Lifestyle
What Else Is Considered During The Underwriting Process?
When you apply for life insurance, your application goes through a process called underwriting. It involves assessing an applicant’s risk profile to determine their eligibility for coverage and set appropriate premium rates. This typically includes evaluating factors such as age, health history, lifestyle habits. The level of protection and duration of coverage are also assessed.
Insurers use all of this information to calculate the level of risk associated with insuring the individual and to establish the terms and cost of the policy. While mental health conditions may necessitate higher premiums, coverage is typically accessible.
Insurance companies also evaluate the severity of diagnoses, treatment consistency, health complications related to mental health, and any recent hospitalizations. Conditions like depression and anxiety can lead to physical health risks, impacting premium rates.
Moreover, conditions associated with suicide risk, such as severe depression, bipolar disorder, or schizophrenia, may increase policy costs and eligibility challenges. So can a suicide attempt, inability to work, or a hospitalization for anxiety or depression in the last 12 months. However, temporary conditions like postpartum depression typically have minimal impact on applications.
In general, insurers may offer immediate coverage for mild conditions like anxiety or depression. While more severe diagnoses might require additional information or come with exclusions.
What If You Don’t Disclose A Mental Health Condition?
When it comes to applying for life insurance, transparency is key. Full disclosure during the application process is crucial to prevent potential complications. Failure to provide accurate information may result in policy cancellation, denial of claims, or future insurance challenges.
Always answer all of the questions accurately on a life insurance application. Otherwise you risk getting a policy you’re ineligible for that doesn’t protect your loved ones. Plus, any money you put into it can’t be refunded if you lied or withheld information that voids your policy. It can also make it more difficult to obtain a new policy in the future even if you fully disclose everything the second time around.
How Much Does Life Insurance Cost With A Mental Illness?
Life insurance premiums vary based on age, gender, overall health, lifestyle habits, and specific mental health conditions. Comparing quotes from different insurers is advisable to find the most suitable coverage.
Based on information supplied during the application process, an insurance carrier will assign a health classification to the applicant. This is how the pricing of the policy is determined. Each insurance company evaluates risk factors differently. So, even though most insurance carriers use the same set of major health classifications, they may determine pricing for each level in dissimilar ways.
As a result, shopping around for life insurance plans works in your favor. Thankfully, Policygenius has a free platform where you can compare pricing across the nation’s top life insurance carriers with no obligation to purchase a plan. You can search and apply online at your convenience. Or speak with a licensed expert for unbiased and transparent advice.
To give you a very rough idea of how much life insurance can cost if you have a mental illness, let’s look at some general examples.
Example Cost Of Life Insurance With Depression or Anxiety
- Type of policy: Term life insurance
- Duration: 20 years
- Payout amount: $500,000
- Mental health condition: Depression or Anxiety
- Age: 30, non-smoker
- Monthly cost: $23 for female, $29 for male
Best Insurance Companies For Individuals With Mental Illnesses
There are hundreds of different life insurance companies to choose from today. So, how do you narrow down the list if you’re in search of a policy?
Based on extensive research conducted by Policygenius, the three best carriers for individuals with mental health conditions are Prudential, Legal & General America, and Brighthouse Financial. Here’s a quick look at each.
Prudential: Best overall
Prudential is one of the top five largest life insurance companies in the US and is the best overall carrier for those with mental health conditions. Its known for beating the competition on pricing for applicants with more than one diagnosis. Those with mild and well-controlled conditions and no other complications can even get access to the company’s best rates.
In addition, Prudential tends to be more favorable to seniors, immigrants holding visas and green cards, and more flexible on income requirements. It’s also a top choice for people with depression, bipolar disorder, asthma, and fibromyalgia.
Legal & General America: Best for Anxiety, PTSD, and Depression
Legal & General America, which also operates under the name Banner Life and William Penn, stands out for its extended term lengths of up to 40 years and competitive rates. Its an attractive option for individuals with depression, anxiety, or PTSD. They tend to have a quick turnaround for qualifying applicants, but underwriting process can be slow for older applicants.
Legal & General America offers affordable rates for individuals with depression, even for those on medication. Mild cases may also get approved without a medical exam.
Brighthouse Financial: Best No-Medical-Exam Life Insurance
Brighthouse Financial provides a compelling option for individuals seeking life insurance coverage without the hassle of a medical exam. With competitive rates and comprehensive coverage, they stand out for their quick application decisions, often within 24 hours. This is ideal for those who favor efficiency and convenience. Brighthouse Financial can also be a good fit on price for those with attention-deficit disorder (ADD) or ADHD.
Some downsides are its traditional term life policies are not available in some states like CA, IL, LA, ME, or NY. And term life applicants are limited to ages 25-50.
Tips For The Application Process
During the application process, be prepared to discuss diagnosis details, treatment history, medication usage, hospitalizations, and impacts on daily life. Remember, complete honesty is always best. And gather as much information in advance as you can to make the process easier.
I also recommend educating yourself on these life insurance myths to help you better understand how life insurance really works.
If you currently experience any mental health problems, or have in the past, here’s a list of information you may be asked to provide.
- Diagnosis name(s)
- The date you were diagnosed
- If you’re currently receiving psychotherapy treatment
- List of any current medications and when you started treatment
- The severity and regularity of your symptoms
- Background info on how your daily life and work are impacted
- Dates of any hospital admissions and any specialist referrals
- Any history of self-harm or suicide attempts
Medical Exam Insights
Depending on your condition(s) and medical history, some insurance companies may require a medical exam, similar to an annual checkup. The cost is borne by the insurer and the exam usually only takes about 30 minutes. You can schedule it at your home or workplace, wherever is convenient.
Typically, you may have to answer a short verbal questionnaire with the same or similar questions from the written application. The technician will also measure your height, weight, blood pressure, and collect samples of blood and urine.
Keep in mind, not all policies and carriers require medical exams. Policies with no-medical exam required are typically offered for lower payout amounts and for applicants with less complex medical histories or non-severe medical conditions. If you have questions about qualifying for a no-exam policy, you can get free personalized guidance from an unbiased Policygenius rep as well.
How To Qualify For The Best Life Insurance Rates
Here are some suggestions to increase your chances of getting life insurance coverage at the best rates possible.
- Follow your doctor’s treatment plan as directed. Otherwise, your condition can appear as untreated during the underwriting process. That can lead to higher premiums or possible denial of coverage.
- Openly disclose your metal health diagnosis. Withholding or lying about medical information may feel tempting, but it’s fraudulent to do so and not worth it. Your premiums could wind up higher than necessary, you could get outright denied, the policy could be voided with no refunds, and you may not be able to get coverage later on if you’re caught.
- Have all information ready about any medications you’re taking including their dosages, frequency, and how long ago you started.
- Be forthright with any hospitalizations you’ve had or other treatments. Sometimes, applications can be postponed for at least one year if a recent hospitalization was for a mental health condition.
- Do your best to maintain a healthy lifestyle and a reliable track record of employment if you’re able.
What If Your Mental Health Condition Was In The Past?
If you had a mental illness in the past and are currently no longer experiencing symptoms, you should still disclose this information. In cases of past conditions, applicants may be asked to provide an attending physician statement, known as an APS. This document provides written evidence to the insurer that your prior treatment plan was completed. And it confirms in writing that your past symptoms have subsided.
If you had a mild diagnosis that did not require any medication, it likely won’t even affect your current premium rates.
Changes In Mental Health After A Policy Is Active
You may be wondering what could happen to your life insurance coverage if your mental health changes after you activate a policy. Fortunately, as long as you disclosed all of your medical information accurately during the application and underwriting process, your policy will remain in effect.
Even if your condition worsens, the rates you locked in when your purchased your policy will stay the same. However, significant fluctuations may impact policy renewals.
On the other hand, if your condition improves, it could be in your favor to shop around for a new policy with better rates. Insurers typically want to see a minimum of six-months to one year of improvement. And it’s best to keep your current policy active all the way through the underwriting process of a new policy. Once your new policy is fully activated, then you can consider cancelling your older policy.
Just keep in mind you have to keep paying the premiums for the policy to stay active. It can be helpful to setup non-payment alerts to be sent to a trusted family member or friend in case you forget to pay or are indisposed so that your policy won’t lapse.
Related: What Is Term Life Insurance? It’s Pretty Simple!
How To Get Life Insurance If You Have A Mental Health Condition
Securing life insurance with a mental health condition is feasible with transparency and understanding. Insurance providers assess applications based on various factors and offer coverage options tailored to individual needs.
Maintaining open communication throughout the application process makes the process easier and eliminates the risk of having your application or policy voided. Full disclosure also ensures you can get the comprehensive coverage you need that’s aligned with your personal circumstances.
If you’re looking to get an affordable term life insurance policy, shop around at Policygenius. You can get unbiased, reliable, and personalized life insurance quotes for free. You can also get help from one of their insurance experts for no additional cost.
Both my wife and I have purchased matching life insurance policies with Policygenius and had a great experience. We rest easier knowing our two little ones will be taken care of if either one of us or both pass before they turn adults.
