Life Insurance With a Pre-Existing Condition

A client came to me last year convinced he was uninsurable. He had been declined by the company his bank referred him to, and reasonably concluded that was that. He had well-controlled type 2 diabetes and had been managing it carefully for a decade.

He was not uninsurable. He was declined by one insurer whose underwriting guidelines happened to be unfavourable for his profile. Another insurer offered him standard coverage at a modest rating.

This is the single most useful thing to understand about life insurance and health: underwriting is not standardised. Insurers set their own guidelines based on their own claims experience, and those guidelines differ dramatically by condition.

Three routes to coverage

1. Fully underwritten

The traditional route: an application, a paramedical exam, bloodwork, and usually a request for records from your doctor. It takes weeks, and it produces the lowest cost per dollar of coverage and the highest available coverage amounts.

Crucially, having a health condition does not disqualify you here. Most conditions result in either standard rates, or a "rating" — a percentage loading on the premium reflecting the additional risk. A rating is not a rejection; it is a price.

2. Simplified issue

No medical exam. You answer a set of health questions — typically a page or two — and a decision often follows within days. Coverage amounts are lower than fully underwritten policies and the cost per dollar is higher, but it is genuine coverage with genuine limits.

This suits people with a manageable condition who would rather not go through full underwriting, or who need coverage in place quickly.

3. Guaranteed issue

No health questions at all. Acceptance is guaranteed within the eligible age range. In exchange, coverage amounts are modest, cost per dollar is highest, and there is almost always a waiting period — commonly two years, during which death from natural causes returns your premiums (often with interest) rather than paying the full benefit. Accidental death is typically covered from day one.

This is the option of last resort, and it is genuinely valuable for final expenses when nothing else is available. It should not be the first thing anyone reaches for.

How common conditions are actually viewed

Broad patterns, not promises — every case turns on its specifics:

• Controlled hypertension — frequently standard rates. Very common and well understood.
• Type 2 diabetes — often insurable, with the rating driven by control (A1C readings), duration, and whether complications exist.
• Cancer history — depends heavily on type, stage and years since treatment. Many cancers become insurable at standard or near-standard rates after a sufficient clear period.
• Mental health conditions — treated far more reasonably than a decade ago. Well-managed depression or anxiety is frequently standard.
• Sleep apnea — usually favourable if treated and compliant with CPAP.
• Elevated BMI — a common cause of ratings, and one of the areas where insurers differ most.

What actually helps your application

Evidence of control. A condition that is well-managed and documented is viewed very differently from one that is untreated or erratic. Recent test results showing stability genuinely move the outcome.

Complete, honest disclosure. This is not just an ethical point, it is a practical one. Material misrepresentation on an application can void the policy, and Canadian policies generally allow the insurer to contest a claim within the first two years. A policy that gets voided at claim time is worse than no policy, because you paid for it and your family planned around it.

Time. If you are recently diagnosed or recently treated, waiting until the condition stabilises can substantially improve the offer. Sometimes the right advice is to secure interim simplified-issue coverage now and reapply for fully underwritten coverage in a year or two.

Where the broker actually earns their keep

With a straightforward, healthy applicant, most insurers will offer broadly similar terms and the value of shopping around is mainly price.

With a health condition, the spread between insurers becomes enormous — the difference between a decline and a standard offer, or between a 200% rating and a 50% one. Knowing which insurer is currently favourable for which condition is the substance of the job, and it changes as companies revise their guidelines.

Practically, it also means not submitting applications everywhere at once. Declines are recorded, and a pattern of them makes subsequent applications harder. The right approach is an informal enquiry to the insurers most likely to be favourable, then a formal application to the best fit.

If you have been declined, or have been putting this off because you assume you will be, it is worth a conversation before concluding anything. The answer is often better than people expect.

The three routes compared

The order matters. Always test full underwriting first, because the gap in cost between the left column and the right is substantial, and a condition that feels disqualifying is often priced far more mildly than people expect.

What "rated" actually means

Applications are not simply approved or declined. The common middle outcome is a rating: the insurer offers coverage at a higher premium reflecting the additional risk.

A rating is usually expressed as a percentage of standard rates or as a table. It sounds punitive and often is not, particularly against the alternative of guaranteed issue. A modest rating on a fully underwritten policy frequently still costs less per dollar of coverage than an unrated guaranteed-issue plan.

Two things worth knowing. Ratings can sometimes be reviewed later — if a condition improves or stabilises for a few years, it may be worth asking for reconsideration. And different insurers rate the same condition differently, which is the single strongest argument for not accepting the first answer you receive.

How insurers view common conditions

Broad tendencies rather than promises, because every application turns on the specifics:

• Well-controlled high blood pressure or cholesterol. Frequently standard rates, especially where treatment has been stable and readings are good.
• Type 2 diabetes. Very dependent on control, duration and complications. Well-managed cases are routinely insurable.
• Anxiety or depression. Often insurable at or near standard rates where it is stable and treated; severity and hospitalisation history matter.
• A past cancer. Time since treatment is the dominant factor. Several years clear changes the picture substantially.
• Heart disease. Usually rated; the event, the intervention and the time since all count.
• Sleep apnea. Often mild in underwriting terms where treatment is used consistently.

The pattern across all of them: stability and time matter more than the diagnosis itself. An insurer is far more comfortable with a condition that has been managed steadily for three years than with one diagnosed last month, even when the second sounds less serious.

Preparing an application that gets the best answer

1. Gather the specifics before applying: diagnosis date, current medication and dose, most recent test results, and your specialist's name.
2. Get a recent check-up if your readings have improved. Current, good numbers are more persuasive than older ones.
3. Answer every question accurately. Non-disclosure is the one thing that reliably destroys a claim years later, and it is the mistake insurers look hardest for.
4. Do not let an adviser shop your file everywhere at once. Multiple simultaneous applications create a record that can work against you.
5. Ask which insurer is most favourable to your condition before submitting anywhere. This is the part that changes outcomes most.

That last point is where an independent adviser earns their place: knowing, from experience, which companies treat a given condition mildly and which do not. See the life insurance page, or if a fully underwritten policy genuinely is not available, non-medical coverage is the fallback rather than the starting point.

What happens between applying and being approved

Knowing the sequence removes most of the anxiety, because the waiting is the part people find hardest.

1. Application and health questionnaire. Usually a phone interview rather than a form, often 30 to 45 minutes.
2. Paramedical visit, where required. A nurse visits your home, takes height, weight, blood pressure and usually blood and urine samples. It is brief.
3. The insurer requests records from your doctor, with your consent. This is the slowest step and the one outside everyone's control — it can take weeks.
4. Underwriting decision: standard rates, a rating, an exclusion for a specific condition, a postponement, or a decline.
5. Offer and acceptance. Coverage begins once the offer is accepted and the first premium is paid — not before.

That last point matters. Nothing is in force during underwriting unless temporary cover has been arranged, which is worth asking about if you have a specific reason to need protection immediately.

Postponed is not declined

A postponement is a common outcome for a condition that is recent or unsettled: a diagnosis within the last year, surgery scheduled, tests still outstanding, or treatment recently changed.

It means "not yet", and that is genuinely different from "no". Insurers are pricing uncertainty, and time resolves uncertainty. A condition that looks unclear at three months often looks straightforwardly manageable at eighteen, and the offer changes accordingly.

What to do with a postponement: note the date you can reapply, keep treatment consistent, and get the follow-up results that show stability. Reapplying with six months of clean, steady records is a different conversation from reapplying with nothing new to show.

Where an independent adviser changes the outcome

With a health history, the insurer you apply to matters more than anything else you control. Underwriting guidelines differ substantially between companies, and those differences are not published.

In practice that means: knowing which insurers treat a given condition mildly; presenting the file so the strongest evidence is in front of the underwriter from the start; and where an offer comes back rated, knowing whether it is a fair reflection of the risk or whether another company would look at it differently.

None of that changes your medical history. It changes which underwriter sees it and how it is framed — and on a rated case, that regularly makes a meaningful difference to the premium you pay for the next twenty years.