One of the first questions you will see on most life insurance applications is whether or not the applicant suffers from Alzheimer’s disease or dementia. If the applicant answers “yes”, the insurance company answers “no”. For this reason, many people with early onset dementia or Alzheimer’s go uninsured, embarrassed or afraid to attempt the application process.
In reality, most people with dementia, Alzheimer’s, or memory loss CAN get life insurance. The product they must use is called “guaranteed life insurance”. Most guaranteed issue policies have a minimum age requirement of age 50, although some will provide coverage to persons as young as age 40 or 45.
This type of policy is usually Whole Life, and it is usually graded during the first one to three years for natural death. This means that if the insured person would pass away from illness or the consequences of their memory loss, the policy would pay the beneficiary part of the death benefit, or else pay back what was paid in (plus an additional percentage). After the graded years are over, the policy pays 100% of the death benefit for death by any reason. Graded policies usually do pay 100% of the death benefit from day one for accidental death.
It does not matter how mild or severe the cognition loss, because guaranteed issue life insurance guarantees to cover age qualified individuals with no health questions asked. They do not require an exam, medical records, or phone interview. This can be a great relief for people who are reticent or unable to answer difficult questions coherently.
Even being graded does not devalue this type of policy, as many individuals with memory loss have good physical health and will live many years beyond the initial graded period.
In addition to guaranteed issue policies, there are a few simplified issue policies that have loopholes for persons who are still able to care for themselves, despite suffering from mild to moderate dementia or Alzheimer’s disease. These policies may require a phone interview, and may not be graded, but pay 100% of the death benefit for death by any reason.
An agent experienced in life insurance for persons with cognitive issues, and who also carries many different products to meet the needs of all types of applicants, can guide you through the choices so that you or your loved one get the lowest price, best features, and most desirable application process.