News & Views

Whether you have diabetes or whether you are concerned about the possibility of being diagnosed with diabetes in the future you should take a minute to review your life cover. If you need more than its probably a good idea to act sooner rather than later.

Here’s why.

Currently Diabetic? – Once you have started your life cover, the terms (including the premium amounts) are generally guaranteed for the rest of the policy providing that continue to pay your premiums, irrespective of future changes in your health. Delaying taking out cover will generally end up costing you more money when you take out cover at a later date because you will be older. It may also cost you more because of the progress of your diabetes, especially if you develop more complications such as retinopathy, neuropathy or kidney issues. So again arranging your cover now protects you from the effects that future changes are likely to have if you delay. Worse still some future health developments could mean that it becomes impossible to be able to obtain life insurance. One highly relevant example of this would be the future development of any heart issues which is a significant additional risk factor for diabetics. Unfortunately no mainstream insurance companies will offer life cover to any diabetic, type 1 or type 2, who also then goes on to develop a condition such as angina or who has a heart attack. However the life insurance policy terms for those diabetics who arranged their life cover before they developed any heart conditions are still guaranteed, which also means that if death accours as a result of a heart attack you are still covered.

Not Currently Diabetic But Worried About Being Diagnosed With Diabetes In The Future?
You would also be well advised to review your life cover now rather than later. Now you may still be able to obatin life cover at lower premium rates and in the absence of any significant existing health factors there is a good chance that you may be able to so at ‘normal’ premium rates, which are the cheapest premium rates. Again if you take out the cover now these premium rates are generally guaranateed. If you delay sorting out your cover until you are diagnosed with diabetes, expect to pay higher premiums and in some cases much higher premium rates. Also if you delay until you are diagnosed you should expect to experience difficulty in being able to arrange some other valuable benefits, for example critical illness cover. This could mean for example if the purpose of the life insurance is pay off a mortgage that the option to include insurance to pay off the mortgage if you have a heart attack is simply no longer available to you even though the risk of it happening has increased.

  We recently had an interesting case concerning diabetes and critical illness cover where we acheived an unusual outcome (more of which below). But its worth looking first at the general current landscape for critical illness cover and diabetes in the UK protection market. Is diabetes a critical illness for insurance purposes? Can you get critical illness cover if you already have diabetes?

Diabetes is a progressive and life changing illness that can lead to some potentially very serious outcomes. So does diabetes count as a critical illness? Does it appear on the list of critical illnesses generally covered on most insurance company critical illness plans? The answer is mostly no. One exception to this is late onset type 1 diabetes which is included as a critical illness condition by at least one major insurer. Late onset type 1  is relatively unusual so the chances of making a claim for this are very small. But it can and does happen. We know a lady who fell ill on holiday last year and was found to havean Hba1c reading of 27 – in her late forties she was diagnosed type 1 immediately and also then had to face  her life long phobia of needles.
But for the vast majority of critical illness policy holders, the diagnosis of diabetes Type 1 or Type 2 will not provide them with a valid condition on which directly to make a claim.

But the story doesn’t end there. As 2.4 million UK diagnosed diabetics know one of the key issues for them is their increased risk of cardiovascular complications. Indeed this is why many diabetics are put onto ‘preventative’ medications for blood pressure and/or cholesterol in order to try and prevent the development of additional cardiovascular risks.

So here is some good news. Even though the diagnosis of diabetes will not in most cases prove to be a valid health condition on which to make a claim under a critical illness plan (despite the seriousness of the condition) policy holders are more likely to be able make a claim if they go on to a heart attack or stroke, as these are more generally valid critical illness claim conditions.

So much for people who don’t have diabetes now, what about those who do? Is it possible for diabetics to obtain critical illness cover?

The answer to this question is genarally negative. Nearly all the mainstream insurers currently will decline applications for critical illness cover from diabetics, irrespective of type, duration or the level of control levels.
But…… there is one company currently who will consider offering critical illness cover to some diabetics. If you are 40 or over and have good control with no complications, you might be able to obtain terms. For those who are able to get cover there will be exclusions on the policy in the main for any cardiovascular conditions. Given the increased risk of suffering cardio vascular conditions some diabetics may consider that the cover excludes the very health risks they wish to cover. Its difficult to argue with that, although it is worth mentioning that a discount in premiums is generally applied to reflect the excluded cover so that diabetics will pass less than non diabetics for once! Also the remaining cover still covers a lot of conditions including cancer, which is a huge area for actual claims.

Finally just to go back to the story of the recent client for whom we acheived an unusual result. The client was seeking critical ilness cover. On paper he had been diagnosed with diabetes and received medication for diabetes. However in his case the doctors felt that the diabetes had been caused as a side effect of strong medication for another health condition which had effectly caused his pancreas to stop making insulin. Furthermore the effect was temporary and the client had to be taken off treatment  when his Hba1c readings dramatically dropped and if was found that his pancreas had resumed production of insulin. Since then the clients blood readings have stayed within ‘normal’ levels and he has not needed any medication.

Whether or not anyone who has been diagnosed with diabetes can ever be described as an ‘ex’ diabetic is a hot topic of debate and one for which there are others far better than I to comment upon. However what is for sure is that for insurance companies generally, its ‘once a diabetic always a diabetic’. Which was exactly the line taken by all the insurance companies when we contacted them. Probably it didn’t help when we told them that this client especially was looking to be treated as a non diabetic so that he could have cardio vascular conditions included in his critical illness cover. The door was firmly shut.

With one exception! We did find one company who were willing to take on board the unusual aspects of this case and who were willing to offer our client the cover he sought. So he is now covered for, among other critical illness conditions, heart attack and stroke – two of the three main critical illness claim areas for critical illness claims for.

NOTE: For more up to date information on this topic read the more recent blog dated 24th August 2011