Insurance is a personal safeguard. Home life and health insurance, and the ability to purchase policies are often taken for granted. For people with mental disabilities, navigating the insurance world can be tricky, and many who could purchase coverage don’t try for fear their disability will prevent them. Mental disabilities cover broad ground; they can be anxiety disorders like Post Traumatic Stress Disorder (PTSD); Depressive disorders such as Bi-polar or Major Depression, neurological disorders such as Epilepsy or Parkinson’s disease, learning disorders like Attention Deficit Disorder (ADD) and brain injuries that lead to cognitive decline. Does this mean that the mentally disabled cannot buy insurance? According to SunLife of Canada, far from it!
According to SunLife, one of Canada’s largest providers of both personal and commercial insurance, ‘Up to 20% of Canadians will experience depression at some point in their lives’. With a population of approximately 33, 390,141 people (2007 estimation) that means approximately just under seven million of us will at some point experience a bout of depression that lasts six weeks or longer, or experience a brief psychotic disorder, that lasts less than one month.
So why all the fuss around people with mental disabilities? In Canada, whether a mentally disabled person can purchase insurance revolves around three things; the nature of the disability, the cost of prescription medication for the disability, and societal and lifestyle statistics surrounding the disability.
The first factor in whether or not you are deemed insurable, is the nature of your mental disability. Most insurers now view short term depression such as post-partum, or depression due to stressful life events, as a ‘mild’ situation. This does not mean the same thing couldn’t happen again, but if you have showed evidence of recovery once you are likely to recover again. Most people falling into this category will find themselves being offered a standard insurance policy with standard monthly rates.
Take medication for an on-going mental disability like mild Bi-polar or even a Neurological condition like Epilepsy then you fall into the second category of ‘moderate’ risk. Here quotes will vary depending upon the cost of your medication and counseling, how long you are likely to need either, and your general prognosis. Doesn’t sound bad, but here’s the kicker, insurance companies look at family history, so even if Uncle Tom twice removed has the same mental disability as you but requires far more costly medication, you are likely to be given the same price quote! This is the policy of placing people in ‘moderate’ risk categories.
Lifestyle statistics are usually the likeliest deterrent for a mentally disabled person not being able to purchase insurance. Companies use scientific data to not only determine how much it will cost the insurance company over your lifetime, but the scientific odds of you passing on a disorder to a biological child. Your life expectancy is also factored in along with that of your biological parents, should the data be available. Insurance companies look especially hard at people with hereditary mental illnesses such as bi-polar, where you have a 50% chance of passing it on to a child, and Schizophrenia with a whopping 80% chance of being passed through the blood line.
Once this is done, if you are still eligible for insurance under the insurance companies criteria, the statistics will have factored in how much your monthly premiums will cost, and the cost is often staggering, and can place you in the second or third ‘high risk’ category. It gets better. Surprisingly, those who are almost always placed in the high risk categories if they can get coverage at all, are people with long standing alcohol and drug addictions, and those who have served repeated time in jail even if only for short periods of time.
So is it really worth being honest with your insurance company about a mental disability? Not unless you are looking for them to cover you for a pre-existing condition, for which you require care. While insurance companies do go digging into your background when you apply for coverage, it is not necessary to mention any bout of depression or minor mental illness that occured more than five to seven years ago. Having a family member with a disorder that you are not looking to insure? The general rule is, if the insurance company don’t ask, then don’t tell!
Navigating the insurance world can be a minefield. The best consumer is an informed consumer, and many consumer groups now advocate for people with mental disabilities to be able to purchase basic insurance such as fire, tenant and health coverage. Not much ground has been gained yet been on the life insurance aspect. Until the laws are changed, many people with mental disabilities either simply pay higher premiums (should they be able to get coverage) lie, or simply withhold information from prospective insurers.