Are you interested in getting life insurance but you’re unsure of if a past criminal record might prevent you from doing so? While some life insurance companies will not insure felons, the good news is that not all insurers have the same guidelines.
Nearly 70 million Americans have a criminal record. Considering that’s one in every three U.S. adults, this is too many people for life insurance providers to exclude whole cloth.
The coverage question, however, gets more complex with the severity of the crime. If the crime in question is a felony, then securing your family’s future with a life insurance policy becomes more difficult.
Can felons get life insurance?
Generally speaking, it is possible to get life insurance with a criminal record. However, this will change from provider to provider and may depend on the severity of the crime. In general, “white-collar” felonies, such as fraud and tax evasion won’t exactly prohibit you from qualifying. However, violent crimes, such as kidnapping, drug trafficking, rape, murder, and any convicted association with such crimes will automatically prevent you from getting life insurance.
Alongside the severity of the crime, life insurance companies also consider other factors. For example, you may still qualify for life insurance if you:
- Were convicted of a felony 10+ years ago (for certain offenses, 20+ years is the standard)
- Have gone at least 10 years without being on probation or parole
- Committed a non-violent crime
- Don’t have a history of repeat or multiple felonies
What type of life insurance can a felon get?
For most applicants, the cost-effective choice is to go with a traditional term life insurance policy. This will typically deliver the greatest amount of death benefit per each dollar spent on the premiums. However, term policies eventually expire and have stricter application requirements.
If you’re denied this route, then the next best life insurance options for felons will be as follows:
Guaranteed Issue Life Insurance
A guaranteed issue policy is one that accepts all applicants regardless of various lifestyle factors, such as a felony history, poor health, etc. All the applicant has to do is pay the premiums to be automatically accepted. It’s important to note that the death benefits on a guaranteed issue policy are typically limited to between $25,000 and $50,000.
Employer Group Life Insurance
Securing employment can be a challenge if you have a criminal record, however, if you are fortunate enough to find an employer who offers group life insurance, then you may be able to obtain life insurance coverage. Employer group life insurance often provides you with coverage regardless of your background.
Depending on the provider, they may also give you the opportunity to purchase additional coverage without undergoing the underwriting process. One caveat of employer group life insurance is that if you leave your job or get fired, then you’ll no longer be covered by the policy (unless it’s portable).
How much coverage will you qualify for?
Life insurance eligibility is based on the risk that you might pass away. Insurers’ data shows that people with criminal records, especially those with felonies, tend to live shorter lives. Hence, the life insurance company may:
- Charge higher premiums
- Limit the death benefit
- Deny your application altogether
However, it should be noted that all felonies are not necessarily the same. For example, some states count one or more DUIs as a felony whereas others don’t. Therefore, it will be helpful to speak to an agent and find out how your situation may be interpreted by a provider.
Strategies for Applying for Life Insurance for Felons
If you have a pending felony charge or are serving a sentence, it’s best to postpone your application for life insurance. In most cases, you will face immediate rejection. If you are approved, but the life insurance company later finds out about your conviction, your policy will be canceled.
If you’ve been released from jail or are on parole, then you should wait at least 12 to 18 months. After this time has passed, speak with an agent before filling out an application. They will be able to gauge your situation and recommend the best course of action.
If the crime you committed was considered a non-major offense, then you should be able to apply for traditional life insurance. Again, be honest about your history and be prepared for the possibility that your application may get rejected. Chances are that after shopping around, you’ll eventually find a provider that will work with you.
Full disclosure is a must.
While it’s important to know how likely you’ll qualify for life insurance, It’s more important not to hide or mislead life insurance companies about any past criminal activity. There’s a good chance life insurance companies will discover the truth when cross-checking your information with public records. As a result, your life insurance contract will be voided.
Talk to A Life Insurance Advisor
Just because you have a criminal record doesn’t mean that you’re automatically disqualified from getting life insurance. Each life insurance company treats an applicant’s situation differently, so there’s certainly a chance you may still qualify.
No matter where you are on your life insurance journey, talking to an experienced life insurance advisor can be extremely helpful. Our team of licensed life insurance brokers can answer any questions you have about how a felony affects your life insurance options and can help you find a policy that works for you and your family. Give us a call today and we’d be happy to help.
