How does epilepsy affect your life insurance?

This is a guest post by Reassured.

What is life insurance and what are the benefits?

Life insurance is simply a financial safety net for a worst-case scenario. You pay a monthly premium and if you pass away during the policy term, your loved ones are paid a cash lump sum.

A life insurance payout is commonly used to cover a mortgage or rent payments, meet family living costs, pay for childcare, help your children through university, provide an inheritance as well as cover the cost of your funeral. These proceeds can ensure your loved ones remain in the family home and continue their current lifestyle when you are no longer around to provide financially.

The COVID-19 pandemic has emphasised just how fragile life can be, highlighting the importance of provisioning for loved ones who depend on us.

But what does this mean for the estimated 600,000 epileptics in the UK¹?

  • Does having epilepsy affect your life insurance? 
  • Can you still secure affordable cover? 
  • Will your monthly premiums be inflated? 
  • Do you have to disclose your epilepsy to the insurer?
  • Will you need to undergo a medical exam?


In this guest article Reassured answers all these questions and more to help you make an informed decision on life insurance in 2021…

Can you get life insurance if you have epilepsy?

Yes, absolutely, in the majority of cases those with epilepsy can secure life insurance to protect their dependant’s financial future. However, the severity of your epilepsy may have an impact on the cost of your monthly premiums or, in a worst-case and unlikely scenario, whether you will be accepted or not. 

How will your epilepsy affect your life insurance?

If you suffer from petit-mal, control your condition well with medication and have not experienced a seizure within the last 5 years you are likely to be able to arrange cover on standard terms. This means you can secure life insurance at the same price as a standard applicant who has no pre-existing medical conditions. For example, a 30-year-old non-smoker could secure £200,000 for approximately 25p-a-day.

If you suffer from grand-mal or experience absence seizures more than once a week you should be able to secure cover but you will likely be charged higher (or loaded) premiums.  

If you have only recently been diagnosed with epilepsy, insurers will generally require a period of stabilisation of your epilepsy before you can be accepted onto a policy. This stabilisation period can vary between insurers and as a result, it is good to source quotes from multiple providers.

Unfortunately, if you suffer from frequent, uncontrollable epileptic seizures, and/or you have required hospital treatment you may find it difficult to secure life insurance. However, there are several specialist insurers, such as The Exeter, who you may be more likely to secure cover through.

Do you need to disclose my epilepsy?

Yes, you will need to disclose your epilepsy during the application process. If you withhold information during the application to secure a lower premium it could render your policy invalid and result in your loved ones not benefiting from a payout. This is known as non-disclosure. Therefore, it is always advised to be completely honest and transparent with the insurer to ensure your selfless investment is not wasted.

Commonly, an insurer will ask you questions regarding:

1.                  Type of epilepsy (petit-mal or grand-mal) 

2.                  The severity of your attacks

3.                  Type of attack, focal onset, generalised onset or unknown onset seizures

4.                  Date of diagnosis/last seizure  

5.                  Medication/control method used  

6.                  Whether you have been hospitalisation  

7.                  Any other related medical conditions you suffer from  

Can a life insurance provider decline you if you have epilepsy?

Yes, although rare, it is possible for your life insurance application to be declined because of your epilepsy. 

Insurers will access each application on a case-by-case basis and a decision will be made based on the severity of your specific circumstances. 

One exception, if you are aged 50 – 85 years, is an over 50s plan. Here you are guaranteed acceptance and do not need to answer any medical questions during the application process. Although, it is important to understand that these policies only pay out up to £25,000 and are usually used to cover rising funeral costs (as opposed to paying off larger debts such as a mortgage).

What is the best life insurance for those with epilepsy?

There are a number of different policy types available, all better suited to covering different aspects of your life.

The four main life insurance policy types are listed below;

Decreasing term life insurance:

  • Covered for a specified term (up to 40 years)
  • Provides a cash lump sum pay out
  • Cover amount up to £1,000,000
  • Pay out sum reduces over time
  • Medical question asked during application

Decreasing term cover provides protection for a specified period, known as the term.

Because the payout sum (or sum assured) reduces over the lifetime of the policy and, therefore, the risk for the insurer decreases this type of cover is usually the cheapest option. 

Decreasing term cover is ideal for covering a repayment mortgage, as your sum assured can reduce at the same rate as your remaining mortgage balance. 

Level term life insurance:

  • Covered for a specified term (up to 40 years)
  • Provides a cash lump sum pay out
  • Sum assured up to £1,000,000
  • Fixed pay out amount
  • Medical question asked during application

Level term life insurance is similar to decreasing term cover, however, here the payout sum remains fixed (or level) throughout the policy term. This makes it ideal for covering an interest-only mortgage or for covering a repayment mortgage as well as rising family living costs.

It is possible to outlive either decreasing or level term policies and a payout will only materialise if you pass away within the policy term.

The whole of life insurance:

  • Provides lifelong cover protection
  • Cover amount up to £1,000,000
  • Fixed pay out amount
  • Loved ones guaranteed a pay out
  • Medical question asked during application

The whole of life insurance is a lesser-known policy type that actually guarantees a payout (unlike the term-based policies above) when (not if) you pass away. As a result, it is actually a form of life assurance (as a payout is assured).

As a result of guaranteed payout premiums are significantly more expensive than a term-based cover and you’ll need to keep up to date with these payments to keep your cover valid. What’s more, because this option only pays out when you pass away and no one knows when this will be, it is possible to pay more into the policy than it will payout.

Over 50 plans:

  • Guaranteed acceptance to those aged 50 – 85
  • Sum assured up to £25,000
  • Loved ones guaranteed a pay out
  • No medical information required

As mentioned above, if you are aged 50-85 and don’t require a large payout sum, an over 50s plan can be a good option as here you will not be asked any medical questions during the application (so you will not be required to disclose your epilepsy). 

It is important to realise that over 50 plans come with a waiting period. This is a period of time at the beginning of the policy, usually 1 or 2 years when you cannot make a claim. If anything does happen to you during the waiting period, the premiums you have paid will be returned to your beneficiaries.

Will you have to undergo a medical exam?

No, it is very unlikely that you will be required to undergo a medical exam when applying for life insurance. 

In most cases, you will simply be asked to provide details about your condition as detailed above.

If you experience any complications with your epilepsy, your application may need to go through manual underwriting and insurers may require further details. Manual underwriting is used on non-standard applicants when a particular risk factor is identified that requires further investigation.

Although an insurer has the right to ask for an exam, it is much more likely for them to request a medical report from your GP. As a result, it is a good idea to have your GPs details to hand when applying for life insurance.  

What if I am diagnosed with epilepsy during the term of my policy?

As long as you are honest during the initial application, then developing epilepsy during the term of an existing policy will not jeopardise a future payout.

You also are not obligated to inform your life insurance provider of your new diagnosis either.

In summary:

  1. It is possible to secure life insurance on standard terms
  2. If your epilepsy is more severe you could pay higher premiums
  3. If just diagnosed insurers may require a stabilisation period of your condition before you can be accepted
  4. A specialist insurer may be more likely to meet your life insurance needs
  5. Epilepsy is regarded as a pre-existing condition by insurers, and you must disclose it during the application process, (except for over 50 plans)
  6. On rare occasions, if your condition is very severe, your application may be declined
  7. There are multiple policy types to choose from
  8. Over 50 plans do not ask medical questions
  9. You are unlikely to be asked to undertake a medical exam
  10. If you develop epilepsy during an existing policy, it will not affect a future pay out

Sources:

[1] https://epilepsysociety.org.uk/about-epilepsy/what-epilepsy/epilepsy-facts-and-myths

Follow:
Share:
This is a guest post by Reassured.

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: