Life insurance aims to provide a cost-effective safety net for your loved ones, so they’d be looked after financially if you were no longer around to provide for them.
Whether you’ve had a mental health condition in the past or are currently living with them, the good news is there are still a range of options available to you. In the majority of cases, having a mental health condition won’t affect your ability to secure a life insurance policy, however the cost of your cover may be higher.
For example, if you’re living with a milder form of depression for which you take medication, you can usually obtain a ‘regular’ life insurance policy, at the standard price.
However, if your circumstances are more severe, an insurer may (for example) ask to see medical records from your Doctor before an application is accepted and possibly may need to increase the premium you pay.
High risk disclosures
If you’re finding it difficult to arrange cover due to your mental health condition through a standard insurer, at Cavendish, we can always look to finding a specialist company who may be able to help. We will always look to help you find the best life insurance policy for you, as we don’t limit your search and offer cover from across the whole market.
During the application process practically every insurer will ask you questions about both your mental health & wellbeing, as well as your physical health where they will typically ask for height, weight and whether you’re a smoker (now or ever before).
All of this is taken into consideration to understand your level of risk to the insurer and the likelihood of you making a claim. Once these factors are understood, your premium (monthly payment) can be generated.
It’s important to answer the questions honestly, as incorrect answers could invalidate any claim being made on the policy, thus undermining the whole reason to purchase an insurance.
Inherently, these questions are quite personal, so you may be more comfortable either applying online or by speaking in confidence to one of our friendly, professional and specially trained customer service advisors.
Secure a policy today
If you have other people who depend on your income and you don’t already have life insurance in place, the best time to buy a policy is right now.
Even without taking mental health issues on board, when it comes to buying life insurance, the younger you are, the less expensive it will generally be. The reason for this is as you get older, other (often physical) medical conditions are more likely to develop and if another serious medical condition arises, so would the costs of taking out a policy and even the possibility that you might be ineligible for cover at all.
Understand what policy is best for you
If you’ve already been looking at different options, you may have noticed that you could get a separate ‘single’ life insurance policy as an individual, or as a joint policy with your partner or spouse. Some people like the latter option as it’s typically quicker to set up, easier to manage and cheaper than you both having separate policies.
Single and Joint Life Insurance policies are similar, but with a few key differences:
‘Single’ Life Insurance covers just one person and if the policyholder were to die during the term of the policy, their loved ones would receive a payout. If you and your partner were to decide to take out two separate ‘single’ policies, then a payout could then be claimed for each policy if both policyholders die within the term.
‘Joint’ Life Insurance covers two people on a single policy and means there’s only one monthly premium to pay. Some people find this simpler to manage and you’ll only need to complete one application, but you would have to answer questions for both policyholders.
If one of the policyholders were to die during the policy term, their loved ones would receive a payout, however the policy would no longer exist for the remaining policyholder; meaning they would need to apply for a new policy if they wanted to still have cover in place.
It’s also important to know the difference between the two types of life insurance policies you’re most likely to come across, being ‘term insurance’ (the more common form of life insurance) and ‘whole-of-life’.
‘Term’ life insurance policies run for a fixed period of time (known as the ‘term’ of your policy) eg. 10, 15 or 25 years - and will pay out if you were to die during the term of the policy. There’s no lump sum payable if you live beyond the term.
With a ‘whole-of-life’ insurance life insurance policy, the clue is in the name. Unfortunately, we all die one day, so as this policy is ongoing, it will pay out a lump sum whenever that day comes.
Naturally, these policies are typically more expensive than term insurance policies since as long as you keep paying your premiums, the insurer will always have to pay out, whereas you may outlive a term insurance policy.
TOP TIP: Whole-of-life insurance is also known as life assurance by many insurers.
If you’re not sure, speak to us, and we can help guide you to what’s the best option for you.
Prefer to phone?
Sometimes, people find it easier to just pick up the phone and speak one-to-one with one of our insurance specialists, who can guide you through the process and support you in choosing the best cover for you and your family.
Call us on 01392 241 850 today to find out more.