Updated: Mar 12, 2024

Life Insurance & Diabetes: How to Shop for the Right Policy

Learn how to shop for a life insurance policy when you have diabetes, which is a medical condition that affects your policy rates depending on your history.
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Life insurance helps you secure a financial future for your family should you unexpectedly pass away.

You pay premiums, and in exchange, your beneficiaries receive a death benefit payment as long as the policy is active when you die.

Part of getting life insurance usually requires submitting to a medical exam and disclosing your health history.

People with diabetes may be worried life insurance may be unaffordable. They may also worry they could get denied due to their diagnosis.

While life insurance premiums are based on your health history, you may still be able to get diabetic life insurance.

Here’s what you should know.

Life Insurance Options for Diabetics

Each diabetic’s case will be different, but many people with diabetes can still get life insurance in one form or another.

Most of the same types of life insurance policies should be available.

The policies may be similar, but some factors will be different.

As a person with diabetes, you should expect higher premiums, lower death benefits, and other less-than-desirable outcomes than a healthy person your age.

Here are some of the types of life insurance that may be available to you.

Term life insurance

Term life insurance is typically the most affordable policy type you can take out on your own.

This is true for people with diabetes, too.

Term life insurance provides coverage for the policy’s set term.

Term policies may last 10, 20, or 30 years, depending on the policy type and what you qualify for.

If you die during the term with the policy in place, your beneficiaries will receive the stated death benefit.

While you won’t fit into the best health classification as a person with diabetes, this is likely the best option to find an affordable policy on your own.

The downside:

You lose coverage after the term expires.

As a person with diabetes, it may be difficult or impossible to secure a new life insurance policy after the expiration, depending on your health.

Permanent life insurance

Permanent life insurance, sometimes called whole life insurance, works very differently from term life insurance.

It’s a policy you keep your entire life. When you die, the death benefit gets paid to your beneficiaries.

This means a life insurance company faces a guaranteed payout as long as you keep your policy in force.

Due to this fact, insurers charge much more for whole life insurance.

Unfortunately, this type of policy is much riskier for insurance companies when dealing with diabetics.

Any condition that could cause you to die sooner results in less time for the insurance company to earn enough money on your premiums to make the policy worthwhile.

It’s still possible to get a whole life insurance policy. Your premiums may be astronomical or your death benefit may be severely limited.

The benefit is you’ll have the coverage your entire life as long as you keep the policy active.

The downside is the much higher cost.

Guaranteed issue life insurance

A sub-type of whole life insurance is guaranteed issue life insurance. Some people call this no medical exam life insurance.

People with diabetes should qualify for this sub-type of whole-life insurance because it typically doesn’t require a medical exam.

Death benefits are usually capped at $25,000 or $50,000 at the most.

Unfortunately, this insurance is costly.

These policies also have a waiting period during the first few years.

If you die during the waiting period, the death benefit doesn’t get paid out.

Instead, the insurance company usually returns the premiums paid to the beneficiaries.

Group life insurance

Group life insurance is a bright spot for people with diabetes looking for affordable life insurance.

These term life insurance policies are usually available through your workplace as an employee benefit.

In some cases, your employer pays the entire premium for the policy. In other cases, you may have to sign up and pay for this benefit yourself.

The premium doesn’t factor in any health conditions, though. It’s a group rate.

You can typically sign up for a certain amount of life insurance coverage with these plans without submitting to a medical exam.

The total death benefit may be limited to a flat dollar amount, such as $50,000, or a multiple of your salary.

If your employer does offer coverage, you may have the option to purchase additional coverage.

To get coverage above a certain amount, you usually have to submit to a medical exam.

This would result in higher rates for a person with diabetes.

The benefit to group life insurance is it could be free as an employee benefit.

Even if it isn’t free, it should be affordable because you don’t have to submit to a medical exam as long as you stay under the insurance limit.

Group life insurance has downsides, though.

First, the coverage amount is usually limited. To get more coverage, a medical exam is required.

The more considerable downside is you may not be able to take your policy with you when you leave your job.

That means your coverage would stop if you get fired or have to quit.

When you leave your company, you’ll be older and may be in worse health than when you started your job.

Applying for new coverage after you leave a job would most likely be more expensive than securing a policy on your own when you started a job.

Some rare group life insurance policies are portable. This means you can take them with you when you leave a job.

You have to take over the premium payments if you do this. Unfortunately, this option is not standard.

Factors That Impact Pricing for Diabetics

Now that you understand the types of life insurance available for diabetics, it’s essential to understand what impacts the pricing.

Here are some critical factors people with diabetes need to know about.

Life insurance ratings

Life insurance companies generally group people into different health rating categories.

Most life insurance companies use the following four categories or something similar to classify the risk of the person looking to get insured.

  • Preferred plus
  • Preferred
  • Standard plus
  • Standard

Sometimes, insurance companies add a fifth category called substandard, which falls even lower on the list.

The better your health, the closer you are to the top of the list.

The closer to the top of the list you are, the lower your premiums should be if all else is equal.

Don’t expect to fall into the top categories.

Type of diabetes

As a diabetic, you know all cases of diabetes aren’t the same.

Type 1 diabetics

People with type 1 diabetes face different challenges than type 2 diabetics.

Type 1 diabetics rely on insulin to manage their sugar levels.

This type of diabetes is usually diagnosed earlier in life and comes with higher risks.

That means insurance companies will charge more to insure a type 1 diabetic than a type 2 diabetic in most cases.

Type 2 diabetics

People with type 2 diabetes are at a lower risk than type 1 diabetics.

They may take oral medication, which insurers generally see as less risky than having to take insulin.

In some cases, diet and exercise may be enough to treat this type of diabetes.

Because this type of diabetes is lower risk, premiums won’t likely be as high for a type 2 diabetic as a person with type 1 diabetes.

That said, they’ll be higher than a healthy person without diabetes.

Gestational diabetes

Gestational diabetes may be temporary or may stick around after pregnancy.

Life insurance companies won’t know the outcome until after your pregnancy ends.

This means they have to price in more risk if you get a policy while you have gestational diabetes.

Your age and diabetes history

The older you are, the riskier you are to a life insurance company.

This is even more true for people with diabetes due to the health risks associated with the disease.

Insurance companies care about how long you’ve had diabetes, as well.

In general, insurance companies will view you as riskier if you’ve had the disease for a more extended time.

How These Differences Impact You

This wide variety of severity and treatment options for diabetics means different things for life insurance.

In general:

The more controlled you can keep your diabetes with natural remedies, the better chance you have to get approved for lower rates.

When you apply for life insurance, expect the company to ask lots of questions about your diabetes.

They’ll take a look at your medical records to see how your diabetes has been managed in the past.

As part of the medical exam, expect to have your A1C levels taken. This can influence your rates.

The lower your A1C level is, the better your diabetes is controlled. This may help you qualify for a better health classification tier.

Consult an Expert

Unfortunately, life insurance for people with diabetes usually costs more.

The more risk factors you have, the more you should expect to pay.

If you want to apply for life insurance as a person with diabetes, consulting an expert may be a smart move.

Some life insurance brokers may specialize in helping people with diabetes or other health conditions find affordable life insurance.

These experts could help you save money by pairing you with the life insurance company that is the best fit for you.

They should know which companies offer people with different types of diabetes, such as type 2 diabetes, the best chances at approval with decent rates.