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Diabetes & Life Insurance

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Type II Diabetes
Type I Diabetes
Pre-Diabetes
Summary

Diabetes is one of the most common health conditions affecting seniors as they shop for life insurance coverage. The CDC estimates that approximately 25% of all seniors are diabetic and the AMA reported that over 34 million Americans have been diagnosed across the US population.

While those numbers are high and diabetes can have many negative consequences on a person’s health, the good news is that it is largely a treatable condition. What’s more is that diabetes does not normally prevent someone from being able to obtain life insurance. This article covers the different types of diabetes affecting seniors and what impact it has on a senior’s life insurance applications.

Type II Diabetes

Type II diabetes is the most common type of diabetes and the number of cases is growing each year. It is estimated that over 450 million people worldwide have Type II diabetes. This condition means that a person is insulin-resistant or that their body doesn’t produce enough insulin. Type II diabetics are often prescribed an insulin injection or an oral medication. Some of the most common oral medications include Metformin, Glipizide, Canagliflozin and Jardiance.

Final Expense Burial Insurance

Final expense or burial life Insurance plans are small, whole life insurance plans that do not require a medical exam or records. These plans normally offer coverage no greater than $25,000 to $50,000. When a diabetic applies to one of these plans the insurance company will consider three things; 

  1. The age of the diabetic when first diagnosed. 
  2. If insulin was prescribed and if so, at what age.
  3. If at any time, there were additional health complications along with the diabetes. 

These plans have relaxed underwriting or rules making it easier for a senior to be approved. While each life insurance company has their own underwriting rules, in general, most companies agree that age 50 is an important year. If a diabetic was diagnosed before the age of 50 and if insulin was prescribed at the time, can determine if a senior is able to get a standard rate (best available with final expense/burial coverage).

If a diabetic was diagnosed before the age of 50 and/or had to take insulin prior to 50, a graded offer may be the result. This means if a death occurs in the first two years of starting the plan it will not fully payout but rather pay a portion of the coverage amount chosen. Some companies do not have an issue with diabetes prior to age 50 alongside insulin usage if there were no other health complications. Speaking with an experienced, independent agent can help you find the best rate and make sure you get day one full coverage if available.

Complications considered with a diabetic’s application include retinopathy (eye), nephropathy (kidney), neuropathy (nerve), peripheral vascular disease (PVD) peripheral artery disease (PAD), or an amputation. This list is by no means exhaustive, but these are the most common complications that can come with diabetes. 

Medically Approved Plans

A medically approved life insurance application will involve either a medical exam or obtaining an applicant’s medical records or both. These plans can offer much more coverage than $25,000 to $50,000.

When a diabetic applies for a medically approved plan, all of the three points above are still considered along with the senior’s A1C and their build (height & weight). An A1C is not the same as a daily glucose test, but it reads the average blood sugar over the last three months. The insurance company can determine a senior’s A1C when a medical examiner comes to take a blood sample or when medical records are obtained.

Generally, an A1C of 7.5% or lower would indicate well controlled diabetes. If so, most medically approved applications would be approved at what is called table II, or 50% above a medically approved standard rate, assuming that they had no other health issues. A Table II rate for a medically approved plan is comparable to a standard rate for a final expense plan.

Each company has their own build table to determine what a healthy height & weight is for a senior. While it is too much for this article to go into depth on each company’s individual build chart, below is a sample for Protective Life’s popular medically approved plans for those over 70. 

Sample Build Chart from Protective Life:

So, the main points affecting an application for a medically approved Life Insurance are:

  1. The age at which the diabetic was when first diagnosed.
  2. The applicant’s A1C.
  3. The applicant’s height & weight (build). 
  4. If at any time, there were any additional health complications along with the diabetes. 
  5. What medication/s have been taken and for how long.

These five factors are not the only variables that can affect a diabetic senior’s application, but likely the most important ones. The factors do not count equally on an application. A rough estimate of how much each of the above may affect an approval might look as follows: 

Some medically approved applications could be awarded standard rates or even better if:

  1. Diabetes was diagnosed after age 60.
  2. Diabetes was diagnosed within the last few years.
  3. The A1C is under 7.5%.
  4. There was not a prolonged period of insulin usage

Type I Diabetes

Type I diabetes is much rarer than type II. Far less than 1% of the senior population lives with this form of diabetes. 

With type I diabetes the body does not make insulin and thus, requires some kind of insulin medication throughout the diabetic’s lifetime. This is normally detected in childhood or as a juvenile, however, it can also be detected later in life. Actress Mary Tyler Moore, for example, was diagnosed in her thirties.

If you are a senior looking for life insurance and have type I diabetes there is a strong chance you also have comorbidity conditions such as seizures, heart disease, depression, cognitive functioning inabilities or kidney disease. If so, then a guaranteed issue plan might be your only choice. In truth, a final expense/burial life Insurance application does not ask what type a diabetic person is, but rather, when the diabetes was diagnosed. If a senior has Type I the diagnosis was likely early in life. There are a few select carriers that can cover a senior beyond Guaranteed Issue Coverage for final expense/burial insurance and even fewer if looking for a medically approved plan which would start at no less than a table IIII or 100% over a standard medically approved rate. The best recommendation is to talk to an experienced, independent agent if you have Type I Diabetes before putting in an application. You can also learn about low cost, Guaranteed Issue plans here. 

Pre-Diabetes

Prediabetes is determined when blood sugar levels are higher than normal, but not yet high enough to be considered diabetes. A normal A1C (3 month blood sugar reading) is below 5.7%, however, if the A1C is between 5.7% and 6.4% then it is considered pre-diabetes. The CDC has estimated that over 88 million American adults have pre-diabetes and 84% do not even know they have it!   

When a senior applies for a final expense/burial insurance plan, pre-diabetes has minimal or no impact whatsoever on an application. This is because no insulin medication is normally prescribed, and a senior is not likely still pre-diabetic if detected prior to age 50. The ADA estimates that 70% of pre-diabetics develop into type II later in life.   

When a senior applies for a medically approved plan, prediabetes will largely be treated as diabetes and so the five variables above still apply.

This chart below summarizes the above without consideration of any complications or problems with a senior’s build.

Final Expense/Burial Insurance

Medically Approved Plans

Summary 

Diabetes has a wide spectrum in severity between type I,II and prediabetes. For some seniors, diabetes dramatically alters their quality of life, while others experience more of a mild adjustment. Different insurance companies have their own rules that they apply to a senior’s application and these rules do change over time. Covid 19, for instance, has caused some insurance companies to tighten up their underwriting rules. 

So, when considering life insurance with a diabetes diagnosis, remember the critical variables listed above; age at which first diagnosed, A1C & build if applying for a medically approved plan, and if there were any health other complications after diagnosis. For best results, talk to an experienced, independent agent. Doing so can spare you from an unnecessary decline, help you get day 1 coverage and save you money. 


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