Last Updated on December 11, 2024
With open enrollment here, it’s that time of the year to renew your insurance policies. You probably already have some type of healthcare insurance, but do you have life insurance? If not, now is the time to start thinking about it. Before you get life insurance, you need to actually know why you need it and what it does for you. Don’t get life insurance just because you heard it was good to have.
Life insurance is designed to equip families with financial security in the circumstance of the death of a parent or spouse. Life insurance can help bear the cost for mortgages, a college education, assist to fund retirement, and provide charitable endowments. It is also, of course, an essential component in estate planning. In a nutshell, if others depend on your income for support, you should greatly consider life insurance. If you don’t have any dependents, you probably don’t have to spend the money on life insurance.
If you are diabetic, you may have heard that you cannot be covered under a life insurance policy because of your disease. This is a myth! As it may be a little bit more difficult to find a good life insurance policy as a diabetic, it is still very possible to do. With the advancement of diabetes treatments, more and more insurance companies are becoming more lenient with the diabetic underwriting of their policies.
There are multiple factors that go into life insurance. Based on your conditions and lifestyle, life insurance companies will determine how much of a “risk” you are to insure. The higher the risk, the higher your premiums will be. Diabetics are considered high risk, but how much you pay will rely upon numerous factors.
When you got diagnosed – the longer that you’ve been diagnosed, the higher your premiums are likely to be.
How easily your diabetes is controlled – the better it’s controlled through medications, diet, and exercise, the lower your premiums will be.
The quantity of medication and which medications you take for your diabetes – medications have a tendency to have negative symptoms in the body, which can raise your risk level.
Other general health questions- such as: height, weight, family history, occupations, etc.
Tips for Life Insurance
If you get turned down for life insurance from one company, look somewhere else. – Different companies have different protocols for who they choose to insure. Just because one company turns you down does not mean that all companies will. You should shop around (even if you already have life insurance), and make sure you are going with the company that offers the best coverage, the best rate, or perhaps a balance between the two.
Term life insurance or whole life insurance
Term life or whole life insurance for diabetics, which is better? There are two main types of life insurance and they are very different, so it’s important to know the difference and determine which one you should go with. Term life is less expensive than whole life insurance because the coverage lasts for a shorter period of time. Most whole life policies have a cash value, or “savings” aspect, that policyholders may borrow against in certain situations. Whole life insurance is valid from the day the policy starts until the day you pass away or turn 100, at which point the insured person may surrender the policy for the cash value (the amount of which is often much less than the death benefit).
A life insurance policy should not be viewed as an “investment”
Life insurance should not be looked at as the same kind of investment as a mutual fund. Some types of life insurance do accumulate a cash value over time that can be borrowed against or withdrawn, if needed, but hold many restrictions regarding when the money is actually available to you. You may also be charged interest, depending on the situation and individual policy.
