Life Insurance

Life Insurance for People with Disabilities

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Living with a disability can add layers of difficulty in ways that others don't recognize, including increasing the complexity and scope of your financial planning. Whether you or a person you're supporting has disabilities, a life insurance policy can help provide a degree of financial security.

When needed most, these policies can create a financial buffer — whether for income replacement, debt management, medical bills, or something else. 

People living with a disability are often met with information on how a disability may impact the chances of finding an affordable life insurance policy.

In general, having disabilities doesn't disqualify people from getting life insurance. However, there are circumstances where it may contribute to higher premium rates. Life insurance underwriting determines premiums based on risks to insured individuals' health and physical well-being. When looking for life insurance for special needs adults, the risks to their health will impact rates and availability the most.

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Finding life insurance for people with disabilities

Depending on the individual and the disability in question, life insurance may look no different for them than anyone else. For most, disabilities in life insurance underwriting are treated to the same evaluation as other potential health risks. 

When a disability doesn't pose a significant health risk, it's unlikely to significantly impact the policy rates or terms. Even in situations where a disability does pose a substantial health risk, many insurers may still offer whole and term life policies. 

With Ethos, for example, you can qualify for a whole life policy based purely on your age—and independent of your health. 

Whole life policies are a common selection for life insurance for adults with disabilities. At Ethos, whole life policies are only offered to older individuals. But term policies can provide younger applicants with a higher coverage amount at a lower premium. 

Can SSI and SSDI recipients have life insurance?

Receiving either social security income or social security disability income doesn't mean you can't apply for life insurance. In life insurance calculations, both SSI and SSDI are treated as income. Neither disqualifies applicants from the right to buy life insurance. However, individual insurers determine rates and eligibility based on age and health factors. 

Even in situations with higher health risks, you can often find whole life and other permanent life insurance policies. Be aware that any money withdrawn from the cash value of a permanent life policy will count towards income and impact how your SSI or SSDI is calculated. 

Deciding on a coverage amount and policy type

Trying to answer, "how much insurance do I need?" can be tricky. However, it's easier when you have a clear idea of what you want to use the policy benefit for. With that in mind, it's possible to use a life insurance calculator to help. When deciding between insurance policies, there are a few variables to consider. First is your age; the younger you are, the more likely you'll find low-rate term policies. 

These often provide the most coverage for the lowest premiums, and many have fixed rates for their duration. The downside of term policies is that they expire after the term is up (often 10, 20, or 30 years), and they don't have a cash value component. 

On the other hand, whole life policies do have a cash value feature and last for the duration of the policyholder's life, as long as premiums are paid. These policies tend to have higher premium rates and lower payout amounts than term policies. That partially offsets the benefits of the policy's permanency and cash value feature. 

It's also common for whole life policies to be offered as senior life insurance and insurance for people with high health risks. Ethos does not require medical exams - you just have to answer a few health questions, and offers whole life insurance to people ages 66-85.

In some situations, it's possible to find life insurance with a disability rider. Disability riders are created explicitly for before you have developed a disability and will kick in if you develop one. These riders can be valuable tools for individuals with a family history of disabilities who haven't yet experienced any. However, disability riders are somewhat uncommon and can increase premiums significantly.

If you're looking for life insurance with a pre-existing condition, these riders are less likely to be valid.

Ethos life insurance

Ethos offers whole life and term policies to qualifying individuals. All applicants can apply without a medical exam, although some health questions are still involved. Applicants between the ages of 66 and 85 are guaranteed approval for whole life insurance, no matter their health history. Term policies are available for applicants between the ages of 20 and 65. 

While acceptance for term policies isn't guaranteed, applicants don't ever need to take a medical exam. Some health questions are still required. Get an instant quote for life insurance online today.

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