Is obtaining life insurance possible with a medical history of self harm and suicide attempts?
We were approached by Miss J and Mr O who were cohabiting partners. They needed life insurance to cover the mortgage on their first home together. We advised that the most suitable and cost-effective type of cover was decreasing term assurance. This was because they held a repayment mortgage. With this type of insurance policy, the sum assured decreases in line with the outstanding mortgage. The premium, however, remains the same over the policy term.
As qualified advisers, we always look at an individual’s needs as a whole. We look at all risks posed to financial wellbeing. So, not just the mortgage cover that they initially needed. We do understand however that every situation and every budget is different.
Medical history and its impact on protection insurance
Medical history is an important factor that insurers consider when assessing whether or not they will offer cover. Sometimes, an insurer will increase a premium (a loading). Or they may exclude a certain pre-existing medical condition – rarely will they decline to offer cover at all.
Our client’s medical history
In this case study, Miss J suffered from depression and anxiety, including self-harm and suicidal thoughts two years ago. We always advise clients to protect themselves against getting a critical illness. This safeguards against the financial impact of suffering a critical illness. Such as heart attack, cancer or stroke, plus many more serious conditions. Our initial discussions with various insurers suggested that this cover would not available to her due to her medical history. We were given the same response when we inquired about obtaining income protection for her. Therefore, life insurance was the only type of cover available to her.
Mr O suffered from depression and had received inpatient treatment at a hospital in January 2020 after multiple suicide attempts. He also suffered from Eczema and Haemophilia since childhood. We held initial talks with many different insurers about his critical illness cover. They all indicated that they would increase his monthly premium, unfortunately, they deemed him high-risk owing to his medical history. As such the higher premiums fell outside his monthly budget. The same issue applied to income protection for him.
We advised them to apply for two separate decreasing term policies. Each insuring the outstanding mortgage amount of £148,750 over a term of 25 years. The insurer in question does not provide joint life policies but would most likely provide them both with cover. Their pre underwritten quoted premiums were around £33 in total.
Our Process and advice
At Future Proof, we have access to specialist insurance companies that don’t deal directly with the public. These companies offer more specialised policies, designed to provide cover where other major providers can’t.
Our research process involves us contacting many insurers to find out the best possible outcome for our clients. Which avoids any nasty shocks later on during the underwriting process.
Would the insurer add a ‘loading’ to their standard premium? (this is an additional sum charged on top of their standard monthly premium to reflect their additional risk). Or, exclude a condition?
Might they decline the application? We want to avoid wasting time by making applications that may be declined.
We have up to date knowledge of the ever-changing landscape of underwriting for all providers in the UK. Future Proof is committed to thorough research so that you don’t have to. What’s more, our advice comes at no obligation and with no hidden costs. You don’t pay us directly but we get paid by the insurer if you decide to start a policy with them.
Two insurers said they would accept Mr O’s application. Although one was significantly more expensive than the other so we submitted applications on his behalf to both. They assessed his GP report and accepted his application. They did add a slight loading resulting in a premium of £17.32 from the quoted £15.
For Miss J, we submitted an application to the only insurer who had indicated that they might offer her the cover. They chose to obtain a GP report before making a decision.
We received the bad news that Miss J had been declined an offer of cover. Undeterred, we asked for more information from the insurer as to why they had declined. They told us that they were not willing to accept the risk due to information they had received from her GP regarding her history of mental health. Miss J was understandably disappointed. We recommended that she discuss her report with her GP to explore if any more information could be provided to the insurer. Her GP agreed that the result was unfair and wrote a letter to the insurance provider’s underwriters.
The insurer reviewed Miss J’s application having received further detailed information from her GP and revised their decision! They accepted her application but added a small increase to her quoted monthly premium, from £18.06 to £18.23.
Both clients accepted their offers of cover and were relieved to finally have found the cover they needed at an affordable premium. We always try to work with our clients and insurers to facilitate the best outcome.
Please note that any premiums mentioned are indicative only and based on this specific case study/ example, which is shown for information purposes only. Your own circumstances will determine whether the amount payable is more or less than the figure quoted.
Client id: 166162373 and 166162373
Whilst you are welcome to get a quote online, we would recommend you speak to one of our advisers.
Any quote that your adviser provides you with will take into account your circumstances and medical history, as well as your budget!
An online quote is just that – a quote – it isn’t a definite offer of cover. What really matters is the premium you are offered, after your application has been assessed.
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Interested in related stories?
Take a look at our handy guides ‘What Cover is Right for me?’
Do you suffer from a medical condition and are concerned you can’t secure Life Insurance, please view our ‘Medical Guides’ for further information.
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