Life Insurance For Terminally Ill

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It is a devastating blow to be diagnosed with an illness that could potentially end your life in a few months or years. When you finally come to terms with reality, it’s only natural to wonder how you can financially protect those you love after you’re gone.

If you don’t have an active life insurance plan, you may think it’s too late to prepare. Fortunately, you can get a policy to ease your family’s financial burdens, such as burial expenses, medical bills, and minor debts.

However, we have to be honest with you that there are limited options because the chances of a policy paying out are high.

Currently, insurance carriers don’t provide life insurance for terminally ill patients. Instead, they offer guaranteed issue life insurance.

life insurance for terminally ill

Guaranteed issue life insurance eligibility

  • Most insurers sell coverage to patients between 40 and 80 years
  • The patient must be a U.S resident

Applying for this type of insurance coverage is easy and straightforward. You can even buy while you are seated on your couch, as no medical examination is required. The insurers might not ask any health questions.

Keep in mind there’s no exact list of end-stage diseases. Some of the common terminal illnesses include:

  • Lung cancer
  • Dementia
  • Motor neuron disease
  • Neurological conditions like Parkinson’s
  • HIV/AIDS
  • Advanced cancer
  • Advanced heart disease

Many insurers usually ask why cancer is listed as a terminal illness even though it can be treated. Early-stage cancer is curable, but if it is not diagnosed earlier and spreads to the lymph nodes or other body parts, treating it becomes hard.

You will find a good number of insurers in New Orleans offering life insurance for terminally ill cancer patients.

Coverage Caps

With guaranteed issue life insurance, beneficiaries can receive coverage amounts ranging from $10, 000 to $25,000. What’s great, these policy payout amounts are tax-free.

Waiting period and payout limitations

Insurers selling guaranteed issue insurance have graded death benefit policies, which protect their companies from paying large amounts to people who recently purchased life insurance policies.

If a policyholder dies within 24 months after being issued with the policy and death is due to natural causes, the insurer will refund the full cost of premiums and interest. While the interest rates vary by the insurance provider, they often range between 10% and 30%.

If death is a result of an accident, then the insurance company will need to pay beneficiaries the full coverage amount. It doesn’t matter if the insured bought the policy just recently.

A patient may go through a lot of pain and depression that they choose to end their life. If they commit suicide before the two-year lapse, the insurer will return the premiums paid with interest unless there’s a suicide clause that states otherwise.

What happens if you outlive your graded death benefit?

The beneficiaries will receive the full face amount of the guaranteed issue life policy once you are gone.

Purchasing the terminally ill insurance policy

Premiums charged by insurers differ significantly, so you should take your time to compare rates from different insurers before making a decision. For a positive experience, you should work with a licensed and experienced life insurance agent who will shop the market for you.

Request professional advice today

If you need an trusted insurance company in New Orleans, get in touch with Michael Dunbar today at (985) 607-4949. Boasting over two decades of experience, Mike will shop among multiple companies to find insurers that offer you the best rates when it comes to insurance for terminally ill patients.

Michael Dunbar

Michael Dunbar

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