Life insurance for cancer patients
Unfortunately, cancer is a growing disease in our society, making the question as to whether to secure life insurance or not even more prevalent.
In 2017, 2.5 million people in the UK were living with cancer and this figure is expected to rise to 4 million by 2030[1].
This highlights the growing need for life insurance. But the question is, can you get life insurance after cancer?
In 2006, thousands of applicants were denied life insurance cover due to previously having cancer[2].
Thankfully, insurers have reviewed this issue over recent years and whilst there are still some instances where life insurance may be denied, it’s now very possible for those affected by cancer to secure a policy.
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Does life insurance cover cancer?
To confirm, it’s possible to get life insurance after suffering from cancer, but the situation is not that simple.
If you’ve had cancer in the past an insurer is likely to regard the illness as a pre-existing condition.
After surviving cancer, there are 4 key factors which will be taken into account during the application process:
- Type of cancer
- Treatment undertaken
- Staging/grading of cancer
- The time since recovery.
Most insurers won’t approve an application until a specified recovery period has passed. This is usually 2-3 years but can be as much as 5-10 years.
This means, if you apply for life insurance during this period, it’s likely that you’ll be denied, or at least the application will be postponed until the desired recovery period has been reached.
The length of the desired recovery differs between insurers, so it’s essential to shop around and find the cover which best suits you.
The cost of premiums can be affected by a number of factors.
The sooner you apply for life insurance after recovery, the higher your monthly premium is likely to be.
This is because the chance of recurrence becomes less as time goes on and therefore, you become less of a risk to the insurer over time.
The type and stage of your cancer, as well as the treatment you’ve received, also has a significant effect on the cost of your premium. This is to account for the likelihood of cancer returning.
It’s highly likely that your insurer will want to obtain information from your consultant, as well as have you undergo a medical, prior to calculating your premium.
For this reason, it can be beneficial to discuss the application with your consultant to determine the information they’re likely to pass to the insurer.
Summary of information you’ll be expected to provide:
- Time since recovery
- Type of cancer and grading, (if this is unknown, your insurer can obtain the information from your GP)
- What type of treatment you had, how long you underwent it and whether it was successful
- Full medical examination.
Some policy add-ons may be affected even if you’re able to secure cover.
Some life insurance policies incorporate add-ons such as critical illness cover.
This means that if you contract one of the illnesses detailed by the policy, one of which is usually cancer, you’ll receive an early pay out.
However, when arranging a new policy, if you’ve previously had cancer but wish to include critical illness, the insurer may have it written into the agreement that the previous illness be excluded from a claim.
Alternatively, in some instances, as opposed to the exclusion taken place, the premiums are increased to account for the risk of possible recurrence.
On the rare occasion, you could still be declined for a policy.
In most cases, there’s an option for cancer survivors to obtain life insurance.
However, if the type of cancer was of a certain severity or resulted in further medical complications, there’s the possibility you may be denied life insurance altogether.
Always ask the question though, as there’s usually an alternative option available.
It’s recommended that prior to going through the formal quotation stage, you ask for a number of informal quotes.
This is because if an insurer carries out a formal quote and the application is denied, insurers can pass on the fact that this denied quotation has been made.
There are a number of insurers which offer policies to those who have previously had cancer.
Using an insurance broker with a specialised team, such as our impaired risk team, can allow you to find the most suitable policy at an affordable price.
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What if my cancer is terminal?
Unfortunately, due to the nature of your cancer, you’ll be unable to secure conventional term-based life insurance as your risk is too high and the cost of your pay out cannot be offset by that of your premium.
However, even with terminal cancer, you still have life insurance options.
If you’re aged between 50-85, an over 50s plan offers guaranteed acceptance without a medical. Meaning you have no obligation to disclose your cancer.
The only condition to take into consideration is that you’re required to live a minimum of 1 or 2 years from the start of the policy. This is known as the waiting or qualifying period.
As a result, your life expectancy diagnosis will determine whether or not this option is appropriate.
Some policies contain terminal illness cover.
If you already have an existing life insurance policy and are then diagnosed with terminal cancer, it’s worth reviewing your policy to determine whether or not it includes terminal illness cover.
If you’re expected to live less than 12 months and your policy includes a terminal illness element, it’s possible to benefit from an early pay out.
This could fund necessary adaptations to your home, pay for a live-in carer or pay off outstanding debts.
What if someone else in my family has had cancer?
Your family history can also affect the cost of your monthly premiums and policy.
Certain forms of cancer can be hereditary, and therefore, if a close relative (mother, father, sister or brother) has previously been diagnosed with one of these conditions before the age of 65, it’s highly likely to increase the cost of your premium.
It’s important to not let this deter you from disclosing all information about your families medical history during the application. Non-disclosure can also lead to the denial of a pay out.
What if I get cancer during the term of my policy?
Your policy will not be affected as long as you’re honest during the application.
As long as you fully disclosed all the required information about your medical wellbeing during the application process, your existing life insurance will not be affected and the pay out will be honoured by the insurer.
Certain cover will provide you with a pay out if you’re diagnosed with cancer during the term of your policy.
As previously mentioned, some life insurance policies contain critical illness cover.
This is an additional level of cover which pays out to the policyholder if they’re diagnosed with a particular illness.
Therefore, if diagnosed with cancer during the term of your policy, it’s worth contacting your insurer to discuss whether or not you’re eligible for an early pay out.
Being diagnosed with cancer doesn’t affect your special event option.
A special event option allows you to increase your level of cover without the need for additional underwriting.
For example, this could take place after having a baby, moving house or getting married.
Even if you’re diagnosed with cancer, you still have this option available to you and are able to increase your level of cover in the instance of a specified special event occurring.
Smoking as we know can increase the risk of getting certain types of cancer. Read our page on life insurance for smokers »
Can I take out life insurance pre-diagnosis?
When a doctor questions cancer, it’s normal for people to think about the future of their loved ones and how it’ll be affected.
Therefore, when suspecting a diagnosis of cancer, many people will question whether or not they can take out life insurance as a precaution for the worst.
Unfortunately, once this dialogue with your GP has been entered, it must be disclosed during the application to ensure your policy is valid.
In this instance, it’s likely that your application will be postponed until the results have been obtained and a diagnosis has been made.
Life insurance cancer payout
A life insurance pay out for a cancer sufferer can vary depending on whether you were diagnosed before or after your application.
As stated, being diagnosed when your life insurance is already in place doesn’t affect the terms of your policy.
Therefore, when you pass away, a pay out will be made to your loved ones as it would with any other cause of death.
However, if you had been diagnosed prior to your life insurance application, there’s the possibility that death from cancer may have been written into your policy as an exclusion.
If this is the case and your cause of death is as a result of your cancer, the policy will be deemed invalid and your loved ones won’t receive a pay out.
For this reason, it’s always essential to read the terms of your policy to determine exactly what causes of death are covered.
The vast majority of policies now have terminal illness cover included. Therefore, if you’re diagnosed with terminal cancer (given less than 12 months to live), you can receive an early pay out.
Finally, if you’ve additional critical illness cover and are diagnosed during the policy, you can receive a pay out in the same way as all other illnesses specified within the add-on.
What next for cancer sufferers?
Whether you’re a cancer survivor, just been diagnosed or have a family history of cancer, be reassured that there are options available.
Why not get in touch with an FCA registered broker, like Reassured, or the insurer with which you hold your existing policy, to discuss your options.
Remember, always be open and honest, whether you’re applying for a new policy, renewing your old one or discussing an existing one. This will avoid denial of payment through non-disclosure, and ensure your loved ones are protected.
If you’re looking for a new policy the best way to ensure you get the right cover for the best price is to compare multiple quotes.
You can undertake this research yourself, or you could save time and money and get Reassured to do it for you. (The best bit is our service is completely free).
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Sources:
[1] https://www.macmillan.org.uk/_images/cancer-statistics-factsheet_tcm9-260514.pdf
[2] https://www.telegraph.co.uk/news/uknews/3343799/Thousands-of-cancer-patients-unfairly-denied-life-insurance.html