Does Life Insurance Cover Cancer?

When you or a loved one face a cancer diagnosis, money worries can add to an already difficult time. Many Australians wonder how their life insurance coverage will be affected, or if they can still take out a policy after being diagnosed.

Here, we’ll unpack life insurance and cancer, including how coverage works and what insurers look for when approving claims.

Understanding life insurance & cancer coverage

When you apply for life insurance, you’ll need to answer questions about any existing conditions, including cancer.

Insurance companies look at several things when assessing cancer risk – including your history, the type and stage of cancer, and your current health. Your answers affect your eligibility and how much your premiums will be.

Some insurers might not cover cancer at all, have extended wait times before you can claim for cancer-related issues, or charge higher premiums. There may be special policies available, but they usually cost more or have different terms. 

Learn more about Life Insurance with pre-existing conditions.

Disclosure obligations

Being honest about your health is crucial when applying for Life Insurance with cancer. You must tell the insurer about any past or current cancer diagnoses. If you don’t, your claim could be denied later, even if it’s for something unrelated to cancer.

NobleOak offers fully underwritten Life Insurance, which means that we gather all your health information upfront. While this involves answering more health questions, it gives you added certainty that your valid claims will be paid – you’ll know exactly what is and isn’t covered from the start, which helps avoid surprises later. 

Types of life insurance that cover cancer

Insurance products provide different types of coverage if you’re diagnosed with cancer unless cancer as a condition has been excluded from your policy when you first purchased it. Here’s a simple breakdown:

• Life cover insurance: This type of Life Insurance pays a lump sum to your family if you pass away, including from cancer. This money can help your loved ones pay off the mortgage, cover daily expenses, or fund education costs.
• Critical illness cover: Also called Trauma Insurance, this pays you a lump sum if you’re diagnosed with a specific serious illness specified in the company’s Product Disclosure Statement – including many types of cancer. You could use this money for treatment costs, recovery expenses, or everyday bills while you focus on getting better.
• Total and Permanent Disability (TPD) Insurance: TPD insurance provides a lump sum payment if you become totally and permanently disabled due to illness or injury – such as certain types of cancer that stop you from working completely.
• Income Protection: If cancer prevents you from working, income protection coverage provides regular payments to replace part of your income. This helps you maintain your lifestyle while you undergo treatment and recovery. 

Can you get life insurance after a cancer diagnosis?

Taking out life insurance with a cancer diagnosis is possible, but there are a few things that affect your chances of approval – and how much your premiums will cost:

• Time since diagnosis: The longer it’s been since your diagnosis and treatment, the better your chances of approval.
• Type and stage of cancer: Less aggressive cancers and earlier stages are generally easier to get coverage for than advanced or aggressive forms.
• Treatment history: Successfully completing treatment in the past improves your chances of receiving coverage now.
• Current health status: Being in remission or having no sign of disease helps your application.

Can you increase life insurance coverage after a diagnosis?

Increasing your life insurance cover after a cancer diagnosis is often difficult. Most insurers require new medical assessments for coverage increases, which may result in cancer-related exclusions or higher premiums. However, some policies offer guaranteed future insurability options, so that you can increase coverage without new medical questions. The best bet is to check your policy details or speak to your insurer for more information on your coverage.

Common reasons why cancer-related life insurance claims are denied

Life Insurance claims related to cancer may be denied for several reasons. Let’s unpack the mistakes you should avoid:

• Non-disclosure: The most common reason for any claim denial is failing to disclose your full medical history when applying. Be honest about your cancer history or symptoms, as insurers can check your medical records when assessing claims.
• Different product requirements: Each insurance product has different claim requirements. For example:
  • Life Cover: When it comes to Life Insurance, cancer death coverage will typically pay out as long as you were completely honest when applying and there are no specific cancer-related exclusions.
  • Income Protection: When it comes to qualifying for a payout from income protection, cancer must prevent you from working – just having a diagnosis doesn’t qualify for a payout.
  • TPD Insurance: Claims depend on whether cancer has permanently disabled you as per your policy’s requirements.
  • Trauma Insurance: This can be the most complex type of insurance, as claims depend on the specific severity and type of cancer matching your policy’s definitions. Talk to your insurer for more information.
• Waiting periods: Some policies have a set waiting period before you’ll be covered for cancer, typically ranging from 90 days to 12 months after the policy starts.
• Policy lapse: If you stopped paying premiums and the policy lapsed before making a claim, you won’t be covered.

Does life insurance cover terminal cancer?

So, can you get life insurance if you have terminal cancer? Generally, if you’re applying for new insurance with terminal cancer, standard policies won’t be available to you.

However, if you’re diagnosed with terminal cancer while already holding a policy, your family will likely receive the Life Insurance cancer payout when you pass away – as long as the policy was active before diagnosis and you were honest about your health when applying (and there are no cancer-specific exclusions).

Some insurers also offer terminal illness benefits. These give you part of the death benefit early if you’re diagnosed with a terminal condition expected to cause death within 12-24 months.

Does a family history of cancer affect premiums?

A family history of cancer can affect your life insurance premiums, but how much depends on several things. Insurers usually pay more attention to cancer in your parents and siblings, especially if they were diagnosed before age 65. Having multiple family members with the same type of cancer might suggest genetic factors, particularly for breast, ovarian, and colorectal cancers.

However, insurers also look at your own health habits, lifestyle and preventative screenings – they consider your whole health picture before setting your premiums.

Award-winning life insurance

NobleOak’s award-winning life insurance offers comprehensive coverage with clear terms. Our fully underwritten approach means greater certainty when it’s time to claim, giving you peace of mind when you need it most.

Take the first step toward protecting your family’s financial future by starting a quote today or using our insurance calculator to estimate how much coverage you might need.Any financial product advice is general in nature only and does not take into account your individual circumstances, objectives, financial situation, or needs. Before acting on it, please consider the appropriateness of the information, having regard to those factors. Any third party websites or tools referred to are subject to their own terms and conditions and NobleOak Life Limited makes no representation or warranty as to any information on those websites. Persons deciding whether to acquire or continue to hold life insurance issued by NobleOak Life Limited should consider the relevant Product Disclosure Statement and Target Market Determination for the product. NobleOak Life Limited ABN 85 087 648 708 AFSL 247302.