Life Insurance With COPD
- Updated: January 18, 2023
- Rikin Shah | Licensed Life & Health Insurance Agent
- Fact-Checked (see our Editorial Guidelines)
Chronic Obstructive Pulmonary Disease (COPD) is a serious health condition affecting millions of people worldwide. Unfortunately, this condition can make it more difficult to obtain life insurance coverage. However, there are options available for those with COPD who want to get life insurance protection.
This article is designed to help educate those living with COPD about obtaining life insurance coverage. You’ll also find helpful tips and resources to make obtaining life insurance coverage easier. With this knowledge, you can take steps toward securing the financial protection you need while living with COPD.
Life Insurance Options With COPD
Individuals with chronic obstructive pulmonary disease (COPD) do have access to simplified issue life insurance.
On the term life insurance side, of the 11 carriers we surveyed, every single one of them would immediately decline an applicant who currently has COPD. As we’ll discuss in more detail below, if your last COPD treatment is far enough in the past (5+ years), you will have the ability to get no-exam term life insurane with select carriers.
As you might expect, underwriting for no-exam whole life insurance (also known as burial insurance or final expense insurance) is considerably more lenient than for term life policies. While it is by no means easy to get immediate coverage and/or preferred rates with COPD, there are certain carriers, such as Transamerica and others, who will offer this type of coverage to those with current COPD.
In particular, carriers will be looking to see how far in the past your last COPD treatment was, and if you’re currently being treated, the number and manner in which you take your COPD medications (e.g., via a nebulizer).
Guaranteed issue life insurance is another option if you would like to forgo answering health questions. Because the insurance company lacks visibility into your health, your rates will be higher than traditional life insurance. Also, you will have a two-year waiting period before you qualify for a payout equal to your full coverage amount.
| Product | Coverage Available? |
|---|---|
| Term Life Insurance | No |
| Final Expense Insurance | Yes |
| Guaranteed Issue Insurance | Yes |
How Common is COPD in the United States?
The prevalence of Chronic Obstructive Pulmonary Disease (COPD) in the United States is alarming. According to the American Lung Association, more than 12.5 million Americans have been diagnosed with COPD; however, due to the often ‘silent’ nature of the disease, it is believed that millions more may be living with undiagnosed COPD. COPD can affect anyone regardless of age and gender, and approximately 15% of all deaths from respiratory disease in America are attributed to COPD.
Sadly, many people do not even recognize they suffer from COPD until it has advanced significantly or required hospitalization for an acute exacerbation. This means individuals may live for years without knowing they have a serious and life-threatening condition. As such, the burden of COPD on individuals, families, and society is immense, with healthcare costs in the US currently estimated to exceed $50 billion annually.
Why Life Insurance Companies Care About COPD?
Life insurance companies are primarily concerned with the mortality risk associated with COPD. Those who suffer from this condition are at greater risk of premature death due to complications such as respiratory and heart failure, associated cardiovascular or cerebrovascular disease, lung cancer, and respiratory infections. COPD is also one of the most common diseases in people with HIV. Life insurance rates for HIV also take a hit as it increases mortality risk.
Furthermore, treatment for COPD is not always successful in slowing down the progression of the disease, which increases the risk of premature death even further. For these reasons, life insurance companies often view those living with COPD as high-risk clients who may require higher premiums or have difficulty obtaining coverage altogether.
The severity of the applicant’s symptoms and lung function tests will be considered when determining eligibility for a life insurance policy. Insurance providers may also look for evidence that the individual is taking steps to slow down the progression of their COPD and reduce any future mortality risk.
What Key Questions Are Asked by Carriers?
- Specific diagnosis?
- Date of diagnosis?
- Any heart problems?
- Medications? How often?
- Any hospitalizations for COPD?
- Results of most recent pulmonary function tests (PFTs), if known?
- Symptoms? e.g., shortness of breath at rest or minimal exertion, moderate exertion? Frequent respiratory infections?
- Name and address of the healthcare provider with the most complete records?
Burial Insurance
15 companies competing for your business
97% of the time we beat Colonial Penn
30 days to get your money back, no questions asked
* Based on website quote requests, through 2/28/23.
(Check your rate to see their rates vs. ours)
Term Life Insurance When You have COPD
Term life insurance is a type of insurance that provides financial coverage for a fixed period of time, usually in the event of death. It offers protection to beneficiaries and helps them financially if the policyholder passes away during the term of their policy.
Term Life Insurance Application Questions About COPD
| Company | App Questions | Decision Criteria |
|---|---|---|
| Mutual of Omaha | Has the Proposed Insured ever (i) been diagnosed with, or (ii) received care or treatment for, or (iii) been advised by a member of the medical profession to seek treatment for, or (iv) consulted with a health care provider regarding: Chronic Lung Disease (except mild Asthma), including Chronic Obstructive Pulmonary Disease (COPD), Chronic Bronchitis, Emphysema, Sarcoidosis or Cystic Fibrosis? | Decline |
| American Amicable | Chronic Lung Disease (except mild Asthma), including Chronic Obstructive Pulmonary Disease (COPD), Chronic Bronchitis, Emphysema, Sarcoidosis or Cystic Fibrosis? | Decline |
Individuals who have been diagnosed with Chronic Obstructive Pulmonary Disease (COPD) would be declined for simplified issue term life insurance.
While in the table above, we show only two companies’ underwriting criteria, based on our survey of 11 no-exam term life insurance companies, we can say confidently that the outcomes shown above are representative of the industry as whole.
In other words, you can expect all no-exam term life insurance companies to decline individuals with current COPD.
Final Expense Life Insurance when you have COPD
Final Expense life insurance is a type of policy designed to provide funds for final expenses such as funeral costs, medical bills, and other debts. It can help provide financial security for both the insured and their family in the event of death.
Final Expense Application Questions: COPD
| Company | App Questions | Decision Criteria |
|---|---|---|
| American Amicable | Have you ever had or been medically advised to have an organ transplant or kidney dialysis, or have you been medically diagnosedas having congestive heart failure (CHF), Alzheimer’s, dementia, mental incapacity, Lou Gehrig’s disease (ALS), liver failure,respiratory failure, or been diagnosed by a medical professional as having a terminal medical condition or end-stage diseasethat is expected to result in death in the next 12 months? | If treated within 2 years, Return of Premium Insurance. If treated between 2 and 3 years ago, Graded Insurance. |
| Transamerica | Have you ever had, been diagnosed with, treated for, tested positive for or been given medical advice by a licensed member of the medical profession for any of the following: C. Parkinson's disease, Chronic Obstructive Pulmonary Disease, systemic lupus erythematosus (SLE), sarcoidosis, Cohn's disease, ulcerative colitis, chronic obstructive pulmonary disease (COPD) including emphysema, chronic asthma, black lung or other chronic respiratory disease? | Standard |
As shown above, individuals with current COPD do have access to final expense whole life insurance from American Amicable and Transamerica.
For American Amicable, individuals with current COPD will be limited to plans with waiting periods and higher rates. Said another way, you will not be approved for American Amicable’s “Immediate Choice” plan if you are currently being treated for COPD.
For Transamerica, those with COPD would qualify for Transamerica’s Standard plan. While not their lowest-priced plan (this would be the “Immediate Solution” plan), the Standard plan does provide immediate coverage, making Transamerica one of only two carriers to unconditionally offer immediate coverage to those with COPD (the other being CVS Health).
Guaranteed Issue Final Expense Insurance
Unlike a traditional life insurance policy, guaranteed issue life insurance is an affordable, no-hassle life insurance policy that does not ask any health questions. It offers coverage for those with pre-existing medical conditions like COPD and provides a lump sum benefit to help pay for funeral costs or medical bills.
By using the accelerated death benefit option, policyholders diagnosed with terminal illnesses can access their death benefits before passing away, allowing them to take care of financial obligations and leave loved ones without the burden of debt.
Burial Insurance
15 companies competing for your business
97% of the time we beat Colonial Penn
30 days to get your money back, no questions asked
* Based on website quote requests, through 2/28/23.
(Check your rate to see their rates vs. ours)
Rikin Shah
Burial Insurance
15 companies competing for your business
97% of the time we beat Colonial Penn
30 days to get your money back, no questions asked
* Based on website quote requests, through 2/28/23.
(Check your rate to see their rates vs. ours)