The Council for Disability Awareness reports that over 37 million Americans are classified as disabled; about 12 percent of the population. Just over 1 in 4 of today’s 20-year-old Americans will become disabled before they retire. Since there are no guarantees in life, disabled individuals may be curious to know if they are eligible for life insurance.

Legal Rights of Disabled Individuals

In America, the Americans with Disabilities Act of 1990 provides legal protection that prevents a life insurance company from denying coverage to a disabled person because of his or her disability. A provider may, however, charge a higher premium to a disabled person if the underwriters believe that the disability will will adversely affect his or her lifespan.

Factors That Impact Life Insurance Coverage for Disabled Individuals

Not all disabilities are the same some could be caused by birth defects while others could be caused by illness. Others may have been caused by accident or injury. Some disabilities are debilitating. Other disabilities may have only a minimal impact on the individual’s life such as minor daily inconveniences. It is reasonable to say that individuals with disabilities associated with complications in later life stages will find it both more difficult and more expensive to obtain life insurance policy. Their chances of being declined by life insurance providers will increase, but if you were denied coverage do not get discouraged there are still ways to insure your life and protect your family.

Life insurance companies assess each application on an individual basis. They go to great lengths to evaluate the specific nature of the disability in question as well as the likelihood that it will have an effect on the lifespan of the individual.

Life insurance companies will evaluate the overall health of disable applicants seeking insurance. An individual who has lost a limb and is working with physical therapy assistants to learn how to use a prosthetic replacement, for example, but is in good overall health otherwise, will be able to obtain a life insurance policy more easily than a person who is very severely limited in function and abilities. A thorough examination is required to determine the depth of disability and the impact it is expected to have on the individual’s lifespan. Premium prices will rise in direct proportion to the extent of disability.

Group Policies for Disabled Individuals

What if the disabled person is employed? Will that positively impact his or her ability to obtain life insurance coverage? If the disabled person is employed, he or she may be able to obtain life insurance through a group plan offered by the employer. In many cases when insuring a group of people, providers do not ask individual questions on health or disabilities. If questions aren’t asked prior to policy issue, a person cannot be rejected for pre-existing disabilities later.

Group plans may also be available through clubs and associations. It is important to note, however, that group plans are usually not transferable. If a disabled person leaves an employer or drops his or her membership in the group, coverage may be discontinued.

Further Options for Disabled Individuals

It’s also possible that a company may issue the disabled individual a life insurance policy with limitations or exclusions. The presence of a pre-existing conditions clause in the policy will allow it to be null and void if the insurer dies as a result of the disability.

There are insurance providers that offer life insurance policies without requiring a full examination. These companies, however, are few and far between. Also, the rates for these policies are usually too high to rationally justify.

According to the United States Department of Veteran Affairs, if you are a service-disabled veteran, you may be eligible for one of several life insurance benefits, including Service-Disabled Veterans Insurance, Veterans Mortgage Life Insurance (VMLI), Servicemembers’ Group Life Insurance (SGLI) Disability Extension and/or Veterans’ Group Life Insurance (VGLI), and an immediate payment under Traumatic SGLI (TSGLI).

How About Government Sponsored Options?

There are only a handful of group and health and life insurance options offered through Medicaid and the requirements for these options are usually fairly high. While the recent debate in America has centered on whether health care should be universally available to all Americans, life insurance may not be far behind.

While there are certain conditions that will prevent disabled individuals from receiving life insurance, nobody should automatically assume they fall in this category.

Most people do not realize that they can work while still on DI find out about the ticket to work program.