Life Insurance with a Felony.
In this article, we wanted to take a moment to answer some of the most common questions from folks applying for a life insurance policy after they have been convicted of a felony or a misdemeanor.
Questions that will be addressed will include:
- Can I qualify for life insurance if I’ve been convicted of a Felony or Misdemeanor?
- Why do life insurance companies care if I’ve been convicted of a Felony or Misdemeanor?
- What kind of information will the insurance companies ask me or be interested in?
- What rate (or price) can I qualify for?
- What can I do to help ensure that I get the “best life insurance” for me?
So, without further ado, let’s dive right in!
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Can I qualify for life insurance if I’ve been convicted of a Felony or Misdemeanor?
Yes, individuals who have been convicted of a Felony or Misdemeanor are usually able to qualify for a traditional term or whole life insurance policy. In fact, some may even be able to qualify for a no medical exam life insurance policy at a Preferred rate!
The problem is…
That usually, there are a lot of “additional” factors that will come into play when trying to determine whether or not an individual will be able to qualify for coverage after they have been convicted of a felony or misdemeanor.
This is why…
Individuals who may have had a “previous history” with the law will want to be careful about which life insurance companies they choose to apply with until they fully understand how their previous “encounters” will be viewed.
Why do life insurance companies care if I’ve been convicted of a previous Felony or Misdemeanor?
There are many reasons why most of the best life insurance companies are going to “care” if you have been convicted of a Felony or Misdemeanor.
Many of these” reasons” may have nothing to do with you or how you live your life today; it’s safe to say that because you have been convicted of a crime in the past, most insurance companies are going to be worried that you may be convicted of another crime in the future.
“Cause you to go to jail!”
And as one can imagine, most life insurance companies are going to want to avoid insuring someone that may one day end up spending significant time in jail or prison!
Many of the “behaviors” that could cause someone to become convicted of a crime are those that would also cause a life insurance company to stress out.
For example, if we look at the top 5 categories for why someone might become incarcerated, it’s easy to see why a life insurance company might be nervous about insuring someone who has already been convicted of a crime.
- Drug offenses 45%
- Weapons, explosives, arson 20%
- Sexual offenses 10%
- Burglary, larceny, property offense 5%
- Robbery 3.5%
The good news is…
That not all life insurance companies are going to use the same rules and guidelines when determining who they will and won’t insure.
The bad news is that the underwriting guidelines for individuals who have been convicted of a felony are not regularly promoted or advertised by individual life insurance companies
Even though many insurance companies will choose to be “lenient” when it comes to insuring certain individuals who have been convicted of a felony or misdemeanor, the last thing that these individual companies want to do is become branded as the “go-to” life insurance company for convicted felons.
We should also mention that…
Some life insurance companies to promote themselves as the “convenience carrier” that only asks 4 or 5 different questions during their application process frequently fail to mention that in addition to these 4 or 5 questions which typically won’t include any questions about previous convictions will include a thorough background check including a:
- Prescription medication database check,
- A DMV report,
- A credit check,
And you guessed it…
A criminal background check as well!
This is why…
It’s important to understand that even though you may not be asked about any previous convictions during your initial application, the insurance company that you are thinking about applying will research this possibility during the underwriting process.
For this reason…
We at IBUSA like to ask many of the same questions the most through carriers ask so that we can better understand your situation and help guide you towards the carrier that will give you the best opportunity for success.
What kind of information will the insurance companies ask me or be interested in regarding my criminal record?
- When were you convicted?
- Less than five years ago?
- Less than ten years ago?
- Have you been convicted of multiple felonies or misdemeanors?
- What were you convicted of?
This particular question is very important because while some life insurance companies may only be concerned about recent felonies, most (if not all) life insurance companies will retain the right to permantly deny any applicant who has been covicted of a “serious” felony such as: rape, murder, child molestation, etc…
- Are you currently on parole or awaiting charges?
- Do you have any history of drug or alcohol abuse?
- Do you have any issues with your driving record?
- In the past two years, have you been hospitalized for any reason?
- Are you currently working now?
- In the past 12 months, have you applied for or received any form of disability benefits?
What rate (or price) can I qualify for when applying for life insurance with a misdemeanor or felony?
As you can see, there are many variables that can come into play when trying to determine what kind of life insurance rates an individual might qualify for after being convicted of a felony or misdemeanor.
This is why it’s pretty much impossible to know what kind of rate you might be able to qualify for without first speaking with you directly.
Most individuals who have been convicted of a felony or misdemeanor will usually fall into one of three different categories that we can make some “assumptions” about that will generally hold true.
3 Primary Categories for Misdemeanors and Felonies
The first group of folks will be those who have recently been convicted of a felony or are awaiting their day in court.
In cases like these, what you’re typically going to find is that most (if not all) life insurance companies are going to want to wait until you have either been declared innocent or you have been convicted, served your time, and are no longer on parole.
The reason for this…
Is because most (if not all) life insurance companies aren’t going to be willing to insure anyone who has the potential to go to jail very soon.
The second group of folks that we’ll commonly encounter will be those who have been convicted of a felony or misdemeanor over five years ago and were not convicted of a “major” felony such as:
- Drug manufacturing/trafficking (some exceptions will may apply),
- Or terrorism.
In cases like these, what you’ll generally find is that you may be able to qualify for a traditional term or whole life insurance policy provided that you choose to apply with the “right” company.
It’s also safe…
To assume that your chances of being able to qualify for coverage and the rate that you may be able to qualify for will improve with the more time that lapses between when your prison sentence or parole ended and when you first applied for life insurance.
It’s usually these “types” of applicants will generally have the best opportunity to qualify for a Standard or better rate.
The last group of folks that we’ll commonly encounter will be those who have served their time, however, they were convicted of some pretty serious crimes.
In cases like these what we have found is that most of the time, we’re simply going to have to turn to carriers who aren’t goig to look at one’s criminal background as a determinant on whetehr or not they will be able to qualify for coverage. The only problem in this sitaution is that this will usually mean that indivdiuals in this situation will only be able to qualify for a small final expense insurance policy or an accidental death policy.
This brings us to the last topic that we wanted to take a moment to discuss with you here today…
What can I do to help ensure that I get the “best life insurance” for me?
In our experience at IBUSA, we have found that usually, the folks who seem to find the “best” life insurance policy for them are those that:
- Take their time reviewing their options.
- Ask a lot of questions.
- And seek out those life insurance agents who know how to deal with complicated matters, such as life insurance with a felony.
It’s important your agent not only has experience working with individuals who have been diagnosed with a wide variety of pre-existing medical conditions, but also have access to dozens of different life insurance companies so that when it comes time to helping a more “challenging” case, they don’t have to rely on a…
“One size fits all approach!”
The good news is that this is exactly what you’re going to find here at IBSA!
Now, will we be able to help out everyone who has been convicted of a Felony?
No, probably not. But what we can tell you is that in addition to offering a wide variety of different term and whole life insurance policies, IBUSA has also worked very hard to establish relationships with many of the Best Final Expense Insurance Companies as well so that in the event that someone isn’t able to qualify for a traditional life insurance policy, chances are there may be some other “type” of product that you CAN qualify for.
So, if you’re ready to see what options might be available to you, just give us a call!