How to Get Life Insurance with Schizophrenia Explained

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15 Minute read

Originally published: August 31, 2023

glioblastoma Life Insurance in Canada

Talk to one of our experienced advisors today!

15 Minute read
Originally published: August 31, 2023

glioblastoma Life Insurance in Canada

Getting life insurance is a crucial part of financial planning since it gives your loved ones financial security and peace of mind. But what occurs when you are dealing with a mental illness like schizophrenia? Although the task becomes slightly more challenging, it is still manageable. We’ll explore the several life insurance alternatives available for people with schizophrenia in this blog post, how premiums are impacted, and the unique riders and limitations one should be aware of. 

To provide you a complete overview of how to navigate this complex environment, we’ll also address some frequently asked questions. We’ll go over your options and the things you should think about in order to make an informed choice, covering everything from term life to whole life and group insurance. This guide seeks to demystify the life insurance application procedure if you or a loved one has schizophrenia so you can get the necessary financial protection for your family.

Overview of Schizophrenia 

Schizophrenia is a chronic and severe mental disorder characterized by disruptions in thought processes, perceptions, emotional responsiveness, and social interactions. Although the exact cause remains unknown, a combination of genetic, environmental, and biochemical factors is thought to contribute to the onset of this complex illness. 

The symptoms are generally categorized into three main types: positive, negative, and cognitive. Positive symptoms refer to distortions or exaggerations of normal functioning, such as hallucinations, delusions, and disorganized thinking. Negative symptoms involve a decrease or loss in the capacity for normal emotional responses and behaviors, such as flat affect, anhedonia, and social withdrawal. Cognitive symptoms can include impairments in memory, attention, and problem-solving skills. 

The condition often emerges in late adolescence or early adulthood and tends to be lifelong, although its severity and course can vary between individuals. Treatment typically involves a multidisciplinary approach that includes antipsychotic medication, psychotherapy, and social support to manage symptoms and improve quality of life. 

Despite advancements in treatment, schizophrenia remains a leading cause of disability, and the associated stigma often compounds the challenges faced by individuals with the disorder.

Case Study: Farid’s Journey to Securing Life Insurance with Schizophrenia

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Farid, a 45-year-old mechanic, had been managing his schizophrenia effectively with medication and regular check-ups for over a decade. Despite his condition being well-controlled, Farid faced hurdles when attempting to get life insurance to protect his family’s financial future. Traditional life insurance providers quoted him high premiums, reflecting the perceived risk associated with his diagnosis.

Determined to find an affordable solution, Farid decided to consult with a specialized insurance agent experienced in high-risk cases. The agent suggested exploring employer-sponsored group life insurance as an immediate measure. Fortunately, Farid’s employer did offer such a policy, requiring no medical underwriting, but the coverage amount was lower than what he desired.

The insurance agent then recommended looking into a Simplified Issue Life policy. Though these usually have higher premiums than standard term life policies, they do not require a medical exam and only a health questionnaire. Farid applied and was pleasantly surprised to receive a moderately priced quote. This policy came with an Accelerated Death Benefit rider but had a two-year suicide exclusion, which is fairly standard.

After weighing the pros and cons of both options, Farid opted for a combination of employer-sponsored group life insurance and the Simplified Issue Life policy. This blended approach gave him the coverage amount he wanted at a cost he could manage, while also providing some added benefits like the Accelerated Death Benefit rider.

Though it required some extra effort and advice from a specialized insurance agent, Farid successfully secured a life insurance package that gave him peace of mind, knowing his family would be financially protected.

What Specific Hurdles Do Individuals With Schizophrenia Often Face When Trying to Get Life Insurance?

Securing life insurance can be a particularly challenging process for individuals with schizophrenia due to a range of specific hurdles. The disorder itself is often stigmatized and misunderstood, even within some sectors of the medical community, leading to potential discriminatory practices during the underwriting process. 

Individuals with schizophrenia usually face higher premiums due to the perceived increased risks associated with their condition. Their choices of policy types and coverage options are often limited, and additional riders or benefits that are standard for the general population may be excluded. 

The medical underwriting process can be especially rigorous, requiring extensive documentation such as medical records, treatment history, and possibly even detailed psychiatric evaluations. Some policies may include mental health-related exclusions or waiting periods before certain benefits can be accessed. In extreme cases, insurance providers may deny coverage altogether based on the diagnosis of schizophrenia, although this is becoming less common as awareness and treatments for the disorder improve. 

Other complicating factors can include job instability and lifestyle issues, which are often scrutinized during the underwriting process. Moreover, individuals with schizophrenia may also have comorbid conditions like diabetes or cardiovascular diseases, further complicating their attempts to obtain insurance. 

Lack of advocacy and support can make navigating this complex landscape even more challenging. Legal limitations or restrictions might also exist in some jurisdictions, affecting the ability of individuals with schizophrenia to purchase or claim life insurance.

The application process itself can be lengthy, involving a variety of documents, interviews, and potentially multiple rounds of review. Even after obtaining a policy, the insured may be subject to periodic policy reviews, where their coverage and premiums might be re-evaluated based on the stability of their condition. Understanding these challenges can equip individuals and their advocates to better navigate the complex world of life insurance.

Why is Life Insurance Important?

Life insurance serves as a financial safety net in case of unexpected events, providing multiple benefits not only to the policyholder but also to their dependents and loved ones. Here are some reasons why life insurance is considered important:

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Financial Security for Dependents

  1. Income Replacement: For families that depend on a single breadwinner or for couples who share expenses, the loss of income due to the death of the earner can be financially devastating. Life insurance provides a lump-sum payment, known as a death benefit, to beneficiaries, helping to replace lost income.
  2. Debt Repayment: Outstanding debts such as mortgages, car loans, or credit card bills do not disappear upon the death of a debtor. Life insurance can cover these debts, preventing the burden from falling on family members.

Estate Planning and Wealth Transition

  1. Estate Taxes: Life insurance can help cover the estate tax, allowing heirs to inherit the full value of an estate without having to sell off assets.
  2. Succession Planning: In business, life insurance can fund buy-sell agreements, ensuring that the remaining business owners have the necessary capital to purchase the deceased owner’s share.

Education and Future Planning

  1. Children’s Education: The death benefit can secure a child’s educational future, helping to cover tuition fees, textbooks, and other associated costs.
  2. Retirement Planning: Some life insurance policies offer cash value components that grow tax-deferred over time, serving as an additional retirement savings vehicle.

Medical and Funeral Expenses

  1. Final Expenses: Life insurance can cover funeral and burial expenses, which can easily run into the tens of thousands of dollars.
  2. Medical Bills: Any medical costs incurred before death can be covered by the death benefit, ensuring that a family’s savings are not depleted.

Emotional Peace of Mind

  1. Financial Security: Knowing that your loved ones are financially protected provides emotional relief. It allows you to focus on living your life, confident that if something were to happen to you, your family’s financial future is secure.
  2. Living Benefits: Some modern policies offer additional features like accelerated death benefits, which allow you to access a portion of the death benefit if you’re diagnosed with a terminal illness, thereby relieving some financial stress.
  3. Investment Options: Certain types of life insurance policies allow for investment in the stock market or mutual funds, providing the opportunity for your cash value to grow.

Flexibility and Adaptability

  1. Policy Loans: Some types of life insurance offer the ability to take loans against the policy, providing financial flexibility in times of need.
  2. Variety of Policies: Whether it’s term, whole, or universal life insurance, you can choose a policy that aligns with your financial goals and circumstances.

Life insurance is a crucial financial planning tool that offers benefits at different life stages and for various financial objectives. By understanding these benefits, you can make a more informed decision on the type of coverage that is most appropriate for you and your family.

How Do Insurance Companies Evaluate Applicants With Mental Health Conditions Like Schizophrenia?

The underwriting process for life insurance involves a thorough evaluation of various risk factors, including medical history, lifestyle, and sometimes occupational hazards. When it comes to applicants with mental health conditions like schizophrenia, insurance companies take a nuanced approach. It’s essential to note that each insurance company may have its specific criteria, but the following are general steps usually involved:

Medical Records and Physician Statements

  1. Detailed Medical History: Underwriters will request detailed medical records to understand the diagnosis, treatment, and progress of the mental health condition.
  2. Physician’s Statement: Some insurers may require a statement from the treating physician to get a comprehensive understanding of the applicant’s mental health. This statement may include treatment effectiveness, medications prescribed, and the individual’s compliance with treatment.

Clinical Evaluation

  1. Severity and Stability: Underwriters assess how severe the condition is and whether it’s stable or progressive. Factors like hospitalizations, episodes, and response to treatment could influence underwriting decisions.
  2. Co-morbid Conditions: Often, mental health conditions like schizophrenia come with co-morbid conditions such as depression or substance abuse. The presence of such conditions could affect the underwriting decision.

Lifestyle Assessment

  1. Occupational Impact: If the condition affects the individual’s ability to work or leads to frequent job changes, that could be considered a higher risk.
  2. Social Factors: Stability in social relationships and a strong support system can sometimes positively influence the underwriting process.

Specialized Tests or Interviews

  1. Psychological Tests: Some insurers may require specialized psychological assessments or tests.
  2. Interviews: Some cases may warrant an interview with the applicant to better understand lifestyle choices, stability, and the impact of the condition on daily life.

Risk Classification

Based on these evaluations, the applicant will be placed into a risk class that determines the premium rates. The classifications may range from Preferred for low-risk applicants to Substandard for higher-risk individuals. Those with severe or unstable conditions may be declined coverage.

Possible Outcomes

  1. Standard or Higher Premiums: An applicant with well-managed schizophrenia may qualify for a standard or slightly higher premium rate.
  2. Exclusions or Riders: Some policies may come with exclusions related to the mental health condition, or additional riders may be attached to the policy.
  3. Declined Coverage: In severe cases, or if the condition is not well-managed, the application for life insurance may be declined.

Disclosure and Honesty

Full disclosure about mental health conditions is essential. Non-disclosure can lead to denial of claims, making the policy useless when it is most needed.


  1. Group Insurance: If individual life insurance is hard to obtain due to mental health conditions, some people opt for employer-sponsored group insurance, which often requires less stringent underwriting.
  2. Specialized Insurers: Some insurers specialize in high-risk cases and may provide coverage when standard insurers won’t.

The underwriting process for individuals with mental health conditions like schizophrenia is complex and varies from case to case. Consulting a knowledgeable insurance agent can offer insights into the best approach to obtaining coverage.

What Types of Life Insurance Policies Might Be Available to People With Schizophrenia? 

Life insurance options for individuals with schizophrenia can be more limited and expensive compared to those for the general population. However, various policy types may still be accessible depending on the severity of the condition, its management, and other health factors. Below are some types of policies that might be available:

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Term Life Insurance

  1. Simplified Issue Term Life: This policy doesn’t require a medical exam but does involve a health questionnaire. If the schizophrenia is well-managed, there might be a chance for approval.
  2. Guaranteed Issue Term Life: These policies usually have no medical exams or health questions but come with higher premiums and lower coverage amounts. They often have graded death benefits, meaning the policy won’t pay the full amount if the insured dies within the first few years of coverage.

Permanent Life Insurance

  1. Whole Life Insurance: Given the higher risk, it may be difficult but not impossible to get standard whole life insurance with schizophrenia. Premiums will likely be significantly higher, and the coverage amount may be limited.
  2. Guaranteed Issue Whole Life: Like its term counterpart, this type doesn’t require a medical exam. However, it comes with higher premiums and lower coverage amounts.
  3. Universal Life: Generally harder to qualify for with a condition like schizophrenia, but it’s still a possibility if the condition is mild and well-managed.

Group Life Insurance

  1. Employer-Sponsored: Offered as part of employee benefits, these policies often require little to no medical underwriting. However, the coverage amount may be lower, and you may lose the policy if you change jobs.

Joint Life Insurance

  1. First-to-Die or Survivorship Policies: These policies cover two individuals and may be a good option if one partner has schizophrenia but the other is in good health. Premiums will still be affected but could be more affordable than an individual policy for the person with schizophrenia.

How Do These Conditions Affect Premiums?

  • Higher Premiums: Expect to pay higher premiums given the increased risk associated with schizophrenia. The premiums depend on factors like age, severity of the condition, and general health.
  • Limited Coverage: Insurers may offer reduced policy amounts to limit their exposure to risk.
  • Exclusions and Riders: Insurers may include clauses that exclude death benefits for specific situations related to mental health, such as suicide within the first two years of the policy.
  • Graded Benefits: Some policies, like Guaranteed Issue, may include a graded benefit period, meaning that if the insured dies within a specific period after the policy is issued (usually 2-3 years), beneficiaries may only receive a partial death benefit or a return of premiums paid.

If you’re considering life insurance and have schizophrenia or any other pre-existing condition, consult a qualified insurance advisor who can guide you through the underwriting process and help identify the most suitable options for you.

Specific Riders or Exclusions

When seeking life insurance with a condition like schizophrenia, it’s essential to be aware of specialized riders and exclusions that could affect your coverage. For example, a Waiver of Premium for Disability rider could be valuable but may be harder to qualify for due to the mental health condition. An Accelerated Death Benefit rider allows early access to the death benefit in case of terminal illness, though the terms could vary for those with schizophrenia. Additionally, a Guaranteed Insurability Option can be particularly useful as it allows for the purchase of additional coverage without new medical underwriting. 

On the exclusion side, policies may have specific clauses that limit or nullify benefits if death results from mental health issues, including schizophrenia. Suicide exclusions are common and may have an extended timeframe for those with mental health conditions. Substance abuse exclusions could also be included, especially given the higher rates of co-morbid substance abuse among individuals with schizophrenia. Exclusions related to high-risk activities may be more relevant if the condition affects judgment or decision-making. 


For those who have been diagnosed with schizophrenia, it is especially crucial that they understand the specifics of life insurance. It’s important to keep in mind that there are possibilities for coverage despite the difficulties and potential restrictions. Term life, whole life, and employer-sponsored group insurance all have advantages and disadvantages that are influenced by premiums, exclusions, and specialized riders. Full honesty and transparency during the underwriting process are essential to a successful application because they guarantee the policy’s integrity when it counts. 

Specialized insurance agents can provide priceless insights that can guide you in making a decision that is appropriate for your particular situation. The process might demand more time and care, but the peace of mind that comes from ensuring the financial future of your loved ones is the ultimate reward.

Frequently Asked Questions (FAQs) about Life Insurance With Schizophrenia

Yes, you can still apply for life insurance if you have schizophrenia, but your options may be more limited, and premiums are often higher. Insurers will evaluate your condition’s severity, treatment effectiveness, and other health factors during the underwriting process.

This depends on the type of policy you’re applying for. Simplified issue and guaranteed issue policies often do not require medical exams but may have higher premiums and exclusions. Traditional policies usually require a comprehensive medical exam.

Premiums for individuals with schizophrenia are generally higher due to the increased risk associated with the condition. Factors like the severity of the illness, your treatment regimen, and any additional health issues will be considered.

Common exclusions may include clauses that limit benefits related to mental health conditions, suicide exclusions, and sometimes, substance abuse exclusions.

Failure to disclose your condition could lead to your policy being invalidated, and claims may be denied. Honesty during the underwriting process is crucial.

Severe or poorly-managed schizophrenia will significantly limit your life insurance options. Guaranteed issue policies may be available but come with higher premiums and lower coverage amounts.

Find a solution for what you’re looking for 

In the often complex world of life insurance, understanding your options is key, especially when faced with challenges like a schizophrenia diagnosis. At Protect Your Wealth, we work with and compare policies and quotes from the best life insurance companies in Canada to ensure the best solution for you and your needs. We provide expert life insurance solutions, including no medical life insurance, critical illness insurance, term life insurance, and permanent life insurance to build the best package to give you the protection you need. 

Contact Protect Your Wealth or call us at 1-877-654-6119 to talk to an advisor today! We’re proudly based out of Hamilton, and service clients anywhere in Ontario, British Columbia, and Alberta including areas such as Oakville, Red Deer, and, Victoria.

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