The Challenges of Securing Life Insurance with a Criminal Record
When purchasing life insurance, the only limitations most consumers worry about are their medical histories and lifestyle habits; but some Americans also have to worry about how their criminal histories can impact their ability to secure coverage.
While it might seem unlikely, consumers are declined coverage every day after honestly answering questions about their prior convictions. How can they overcome this unfortunate hurdle and buy insurance they need for their families?
Criminal Histories Create Life Insurance Hurdles
Every one makes mistakes in life and, in some form or fashion, theyâ€™re asked to pay for those mistakes. In some instances, mistakes are repaid by accepting a misdemeanor or felony on a criminal record.
Itâ€™s no secret that having a criminal record brings with it major stigma that can be difficult to overcome. It creates challenges in securing a job, attending college, or even regaining the trust of friends and family, but another hurdle of having a criminal record is securing a life insurance policy.
Having a felony on your record — and in some cases, even a misdemeanor — can translate to an insurer that your lifestyle choices and behavior come with a certain level of risk. As a result, you might be declined the option to purchase coverage.
Fortunately, being declined with one or more companies doesn’t mean your chances of securing a policy are completely out the window.
How to Buy Insurance with a Criminal Record
If you have been trying to buy insurance with a criminal record and have had little luck to date, there is still hope for you. Consider the following options as you continue your search:
- Automatic-issue coverage: If you are able to secure a bank or credit union account, you may have access to automatic-issue policies that are sent to you via the financial establishments. Often times, youâ€™re automatically approved for $10,000 or more in life insurance with very few hurdles to jump through. If you acquire more than one of these policies, you may secure the coverage amount you desire.
- Work with insurers that accept DUIs: Though youâ€™re searching for life insurance, if you can find a company that works with individuals with DUIs when purchasing auto insurance, companies mayÂ be more lenient with other coverage options, as well.
- Consider mortgage life insurance: Mortgage life insurance is also a more lenient coverage option because it covers payments on your home if you die. While this insurance wonâ€™t pay for funeral expenses, youâ€™d know your family will have a place to live.
Itâ€™s extremely important for you to be honest about your prior convictions when applying for coverage, no matter how tempted you are to sidestep the truth. If the insurer finds out you lied, your policy will be promptly canceled and you could face other issues from the company.
Also, keep in mind that there may be a period of time when you no longer have to declare your offense, depending on the crime committed. Conduct research so that you donâ€™t unnecessarily list a crime you donâ€™t have to declare.
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