If I die tomorrow, my family is going to face some financial hardship. Oh, I tried to get life insurance. I wasn’t able to.
I have a long history with bipolar disorder. I’ve been well, high functioning and without any episodes that required hospitalization, or even medication changes, for years. I’m married with a child, and can hold a job and pay my bills. I’ve never smoked, am not over weight, and do well in my annual physicals. Life insurance should be a cinch.
But in the past I was a mess.
I have rapid-cycling mixed-episode bipolar disorder I, and it took many years and a few hospitalizations before I recovered and managed to live a stable life with the disease.
When my wife and I found out she was pregnant, we decided that life insurance should be an important part of our financial plan. Our advisor arranged quotes, and a nurse came over to do a health assessment and take blood and urine samples.
I was in excellent health, but when she got to the questionnaire and I told her my history, and that I was presently taking an anti-convulsant and an anti-psychotic, she told me the examination was pointless.
I was rejected and have been unable to acquire life insurance since.
Underwriting life insurance is different from underwriting health insurance. In health insurance groups are formed, be they employees of a company in a private policy or a large group of people in a public option like Medicaid. Healthy people with low medical expenses subsidize those with expensive conditions.
But life insurance is individually rated. Only the applicant’s own record and risk is considered, so the healthier one is the less they will pay.
And if one has a condition with challenging mortality rates, they will find getting coverage difficult.
The trouble with a blanket statement that says people with bipolar disorder cannot get life insurance, or one that says life insurance is available to people with the diagnosis, is that there are several kinds of bipolar disorder.
A person with bipolar II or cyclothymia who has been stable for years, has no history of suicidal ideation, and has not been hospitalized beyond once when they were first diagnosed will likely get a competitive quote. They’ll surely pay more than a healthy individual, but insurance will still be available.
But someone with bipolar I, a history of hospitalizations, or a suicide attempt is another story. If they can present records that show they have been stable for years and adhere to their prescribed treatment regimen they are still likely to be rejected. If a quote is available, it will be prohibitively expensive.
A history of smoking or substance abuse combined with bipolar disorder will also pull you out of the rating tables.
Also, anyone who has been recently diagnosed with any mental illness must wait until they have been successfully managed for a significant period of time before an insurance company will show interest in insuring them.
Insurance is all about risk and probability, and numbers speak louder than individual stories. So, even though my prognosis is good, I look bad on an actuarial table.
At about the same time I applied for long-term care insurance. As an older parent I don’t want my daughter to be stuck with a hardship just as she is starting out in life. I thought this was the most responsible thing to do.
But the results were the same as with life insurance.
The insurance company first wanted a letter from my psychiatrist summing up my experience with bipolar disorder. When this looked good they decided it wasn’t enough.
They wanted 10 years of medical records.
The experience was so unpleasant, and the final quote so expensive, that even long-term care coverage didn’t make sense. I’ll have to risk ploughing through our savings if I need care in a facility late in life.
So you can do everything you’re supposed to and achieve a positive result and still be deemed an uninsurable risk. Insurance is an unemotional business, so it’s pointless to get angry about it. Some of us, even with good lives, are a bad risk.
As for my family, we’ll save what we can and hope for the best.