Life Insurance with Post-Traumatic Stress Disorder (PTSD)

People living with a PTSD diagnosis face a daily reality that the general public finds difficult to understand. They may find it difficult to obtain life insurance even though they want to protect their loved ones’ and ensure they are financially secured.  

In this blog, we will explore the various types of life insurance available and discuss how different insurance companies might classify and rate your application based on your unique circumstances.

In this article:

• Overview of Post-traumatic stress disorder (PTSD)
• Can You Get Life Insurance with PTSD?
• Case Study: A Calgary Teacher’s Journey Through PTSD to Life Insurance
• What Impact Does PTSD Have on Life Insurance Premiums?
• Life Insurance Options Available to PTSD Patients
• Which Companies Offer The Best Life Insurance For PTSD?
• Frequently Asked Questions (FAQs) about Life Insurance with PTSD

Overview of Post-traumatic stress disorder (PTSD)

Post-traumatic stress disorder (PTSD) is a mental health condition caused by a terrifying incident, whether experienced or witnessed. Symptoms may include flashbacks, nightmares, extreme anxiety, and uncontrollable thoughts about the event.

Most people who experience traumatic circumstances may have some difficulties adjusting and coping, but with time and self-care, they usually recover. If your symptoms worsen over time, persist months or even years, and interfere with your daily functioning, you may have PTSD. Getting treatment when PTSD symptoms appear is crucial for reducing symptoms and improving function.

Can You Get Life Insurance with PTSD?

Yes, you can get life insurance with PTSD! PTSD is a medical condition, and like other medical conditions, it can make it difficult to get affordable life insurance. In Canada, the prevalence of PTSD among adults is significant, with approximately 8% of the population exhibiting moderate to severe PTSD symptoms, a figure that is greater among women (10%) than men (6%). This proportion is especially high among young people aged 18 to 24, reaching up to 14%, compared to only 3% among seniors aged 65 and older. Furthermore, approximately 5% of Canadian individuals have reported receiving a PTSD diagnosis from a healthcare provider.

PTSD affects both military personnel and civilians alike. PTSD can be triggered by a variety of factors, including abuse or assault, traumatic accidents, natural catastrophes, abrupt or significant loss, and terrorist acts. When a client with PTSD applies for life insurance, he or she is sometimes charged high rates or denied due to being high risk.

This is why it’s vital to work with an independent insurance agent who understands the complexities of applying for life insurance with PTSD. An experienced insurance agent will be able to recommend the best life insurance companies for your specific medical circumstance. The insurance agent may prepare you for the application process to make it as simple as possible, as well as speak with the underwriter to explain why you are worth the risk.

Case Study: A Calgary Teacher’s Journey Through PTSD to Life Insurance

Sarah, a 31-year-old teacher from Calgary, Alberta, has been dealing with the challenges of PTSD since a tragic event occurred some years ago. Despite her initial fears that her condition would make it impossible to secure life insurance, Sarah embarked on a journey to provide financial security for her family. With the help of a dedicated independent insurance advisor, she explored her options, learning about the different types of life insurance policies and how companies view her situation uniquely.

Sarah’s case was unique. Her PTSD was well-managed through therapy and medication, and she maintained a stable job and a healthy lifestyle. These factors played a role in how insurance companies assessed her application. After several consultations and comparisons, they found a company that recognized her efforts to manage her condition and offered her a life insurance policy at a standard rate.

What Impact Does PTSD Have on Life Insurance Premiums?

A person with well-managed mild PTSD who has not experienced any hospitalizations or suicide attempts is typically eligible for a standard rate class. The severity of your PTSD will determine where you are on the rate class table.

The individual life insurance companies assess how all of this affects your rate. But generally speaking, your premiums increase with your risk. Your insurance agent could suggest a guaranteed issue life insurance policy for individuals experiencing severe post-traumatic stress disorder. Applying is a simple and quick process. You won’t have to go through the lengthy and typical medical underwriting process, insurance can be granted quickly and sometimes even the same day. Additionally, you won’t have to worry about being turned down because of your PTSD.

In Canada, guaranteed issue life insurance policies, which do not require medical exams or health questions, offer coverage amounts typically ranging from $5,000 to $25,000. These policies are designed for individuals who may have difficulty obtaining traditional life insurance due to health issues. For instance, Manulife offers guaranteed issue life insurance with coverage amounts ranging from $5,000 to $25,000​​. Similarly, Sun Life provides options for coverage amounts of $5,000, $10,000, $15,000, $20,000, or $25,000​​.

The cost of these policies can be higher than traditional life insurance due to the increased risk to the insurer, as they have limited information about the applicant’s health. Premiums are determined based on factors such as age, gender, smoking status, and the specific insurance company. For example, rates from Canada Protection Plan for non-smoking individuals at age 40 for a $25,000 policy can start around $52.74 per month for females and $70.94 per month for males, with prices increasing with age​​.

These policies are particularly suited for those with severe and prolonged health conditions, offering a way to secure some level of financial protection for their families without the need for medical underwriting. It’s important to consider the specific terms, such as the two-year waiting period before the full death benefit is payable, and to compare options across different providers to find the most suitable coverage for your needs.

The below table outlines the life insurance rate classes, including where a person with well-managed mild PTSD, who has not experienced any hospitalizations or suicide attempts, would typically fall:

Life Insurance Options Available to PTSD Patients

Like everyone else, people with PTSD have access to a variety of life insurance plans, each tailored to meet specific needs and situations. Below is a quick summary of the various kinds of life insurance that are offered:

Permanent Life Insurance Policy: This type of policy offers lifelong coverage, as long as premiums are paid. It’s not just insurance, it also includes a savings component that can accumulate cash value over time. Permanent life insurance is ideal for those looking to provide financial security for their dependents while also building a financial asset.

Term Life Insurance Policy: Term life insurance provides coverage for a specific period, typically ranging from 10 to 30 years. It’s a straightforward protection option that pays out a death benefit to the beneficiaries if the policyholder passes away during the term. This option is often preferred for its lower premiums compared to permanent life insurance and is suitable for people looking for affordable coverage with a clear end date.

Guaranteed Issue Life Insurance Policy: This policy is designed for individuals who might have difficulty securing traditional life insurance due to health issues, including PTSD. It requires no medical exam or health questions, making it an accessible option. However, it usually comes with higher premiums and lower coverage amounts, and often includes a graded death benefit, which limits the payout if the policyholder dies within the first few years of the policy.

Which Companies Offer The Best Life Insurance For PTSD?

This chart shows how different life insurance companies may look at applications from people with PTSD. Since PTSD is a complicated condition that has many different effects on health and daily life, getting insurance can be very different for people who have it. So, it’s important to work closely with an insurance expert who knows what they’re doing. An experienced advisor knows how to navigate the different underwriting rules of different insurers to find you the best insurance for your needs.

Frequently Asked Questions (FAQs) about Life Insurance with PTSD

Find a solution for what you’re looking for 

Obtaining life insurance with PTSD is possible with informed steps and expert advice. 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 Hamilton, Airdrie, and Richmond.