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I've Been Told I'm Uninsurable

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I've Been Told I'm Uninsurable
Sylvain Dion
Why, and what can I do now?
Whether it is life, health, disability, or some other type of insurance, you are likely discovering that purchasing insurance is not as easy as buying a loaf of bread. Simply because you may want insurance and are willing to pay for it, does not automatically mean that an insurance company will agree to insure you.

Once you apply for insurance coverage, the application must generally go through a strict underwriting process before the insurance company decides whether they will issue a policy for you to purchase as requested, offer you a modified policy with conditions or restrictions, or perhaps even decline your application altogether.

The percentage of applicants who are declined insurance varies by the type of insurance for which they apply. For example, within the OMA Group Life Insurance plan, about 9% of applicants for life insurance applications were declined in 2013-2014 because they were deemed uninsurable. For the OMA Group Disability Insurance plan, about 6.5% of applications were declined in 2014. For the overall Canadian market in disability insurance, decline rates range between 10% and 15%, but an additional significant percentage are issued policies with certain pre-existing conditions excluded.1 Long Term Care Insurance and Critical Illness Insurance have even higher declination rates. The OMA Group Critical Illness Insurance plan declined just over 10% of applicants in 2014, and Long-Term Care decline rates vary dramatically for ages 50 and over, and can be significant, as illustrated in the following table​2

Age​ of
Declined Coverage
Under 50
50 to 5913.9%​
60 to 6922.9%
70 to 7944.8%
80 and Over69.8%


What does it mean to be "uninsurable"?  Generally, it means that a company will not issue a policy of the type you applied for, although the reasons for being uninsurable vary from company to company and from policy type to policy type: what is acceptable for a life insurance policy may not be acceptable for a long term care policy, for example.  ​

Insurance companies look at morbidity and mortality from a different perspective than you might expect and this difference is not always obvious. Insurance underwriting is concerned with deviation from the average. For example, most physicians and insurers would agree that early mortality is bad and late mortality is good. Illness or accidents, however, leads to a different way of thinking. While most people concur that a long life, even if somewhat ill or partially disabled, is usually preferable to mortality, companies paying the disability claims or bills for long-term care need to consider the increased costs of longer-than-average claims periods when underwriting and evaluating certain illnesses. This means that some diseases that are quite possible to live with may sometimes prevent you from getting a disability or long-term care policy – or may cause restrictions or conditions to be added – whereas the same condition has no impact on eligibility for a life insurance policy. Similarly, conditions that cause near-certain mortality may limit coverage on a life insurance policy, but not have an impact on a disability policy.

Sometimes “insurability” may be a temporary situation; often it can be a long-term state. There are a number of conditions, both medical and non-medical, which could potentially make a person “uninsurable”. Some factors – a criminal conviction for fraud, for example – make it virtually impossible to buy any type of insurance, but many types of policies have their own specific factors that may lead to “uninsurability”. Following are partial lists of conditions that may affect applications for each of Life, Disability, Personal Health Care and Long-Term Care Insurance.

  • Life Insurance expand minimize

  • The following are some of the factors that can contribute to your life insurance application being declined:

    • ●    Lifestyle & Financial Conditions:

          • •    Alcoholism 
          • •    Bankruptcy (not discharged)
          • •    Illegal drug use 
          • •    DUI/DWI/general driving record (usually multiple convictions)
          • •    Probation/parole (currently)
          • •    Suicide attempt (within the past 2 years)

    • ●    Various Medical Conditions, such as:

          • •    Abdominal aortic aneurysm (within the past 6 months)
          • •    Alzheimer's disease/dementia
          • •    Cancer treated with chemotherapy or radiation therapy (present)
          • •    Cirrhosis of the liver
          • •    Gastric/intestinal bypass (within the past year)
          • •    Heart attack (within the past 6 months)
          • •    Heart bypass surgery (within the past 3 months)
          • •    HIV positive
          • •    Kidney failure/disease, on dialysis (present)
          • •    Lung disorder, on oxygen (present)
          • •    Mental disorder requiring hospitalization (within the past year)
          • •    Organ transplant pending or received (within the past year)
          • •    Pregnancy with complications (currently)
          • •    Stroke (within the past  year)
          • •    Valve replacement (within the past year)​

  • Disability Insuranceexpand minimize

  • Illnesses and accidents occur more frequently than death, causing disability insurance to have a longer list of factors contributing to declination:

    • ●    Lifestyle & Financial Conditions:

          • •    Significant travel or foreign residence (difficult for insurers to administer disability claims). Many insurers require a minimum of 6 months stay in Canada every year to be eligible.
          • •    Travel to high-risk countries
          • •    Full-time military personnel
          • •    Alcohol, drug abuse, criminal activity, poor driving record may render a person uninsurable
          • •    Risky sports or avocation – although insurance may be possible with an exclusion of the activity

    • ●    Medical Conditions:

          • •    Musculoskeletal conditions
          • •    Mental and nervous problems
          • •    Severe hypertension
          • •    Obesity
          • •    Diabetes
          • •    Epilepsy

    Depending on the condition and the insurer, disability insurance may be issued with modifications for some of the above factors, such as:

    • ●    Exclusion riders (for specific conditions)
    • ●    Extra premium for general conditions (such as obesity)
    • ●    Longer waiting period (for a condition that may not result in long disability
    • ●    Reduced benefit period

  • Personal Health Insuranceexpand minimize

  • Personal Health Insurance helps cover your expenses if you require medical treatment and, as you would expect, the reasons for an application being declined tend to be closely related to overall health:

    • ●    Ongoing disability
    • ●    Unable to work full time due to an illness or a disability
    • ●    Pending medical investigation
    • ●    Pending surgery
    • ●    Major medical conditions such as HIV, Alzheimer, cancer, kidney/lung/liver disorder, multiple sclerosis, heart attack, stroke etc.

  • Long-Term Care Insuranceexpand minimize

  • Long-Term Care insurance covers the ongoing costs of care and support if you become dependent for a lengthy time-period. Although often thought of as care for the elderly, long term care needs can arise at any age and, because of the tendency for prolonged and significant claims, the reasons for your application being declined are focused around conditions that may lead to a prolonged period of care:​

    • ●    AIDS or HIV positive
    • ●    Alzheimer's disease
    • ●    Amyotrophic lateral sclerosis (ALS or Lou Gehrig's disease)
    • ●    Chronic congestive heart failure
    • ●    Cirrhosis of the liver
    • ●    Cystic fibrosis
    • ●    Degenerative disc disease (severe)
    • ●    Dementia/senility
    • ●    Huntington's disease
    • ●    Incontinence
    • ●    Kidney/renal failure
    • ●    Marfan's syndrome
    • ●    Memory loss
    • ●    Multiple myeloma
    • ●    Multiple sclerosis
    • ●    Muscular dystrophy
    • ●    Osteoarthritis (severe)
    • ●    Osteoporosis (severe)
    • ●    Paraplegia, hemiplegia, quadriplegia
    • ●    Parkinson's disease
    • ●    Post polio syndrome
    • ●    Schizophrenia
    • ●    Sickle cell anemia
    • ●    Spinal stenosis (moderate or severe)
    • ●    Systemic lupus arythematosus
    • ●    Multiple transient ischemic attack (TIA) and/or stroke or cerebrovascular accident (CVA)