Life Insurance Coverage for Those with a Criminal Record
Can people with a criminal history still obtain life insurance? In most cases yes, they can. If you’ve been convicted of a misdemeanor or lesser crime you can still qualify for a life insurance policy at an affordable rate.
However, it’s a little more difficult to find affordable life insurance if you’ve been convicted of multiple crimes or have recently had a DUI or DWI conviction. In those cases, you’ll have to pay a higher rate.
If You Have a Felony
Having a felony on your criminal record also doesn’t necessarily prevent you from obtaining a standard life insurance policy, either. It just may require a little research on your part because different insurance companies have different post-probation time requirements. And they will cost more.
Some insurance companies will approve a life insurance application with as little as two years post-probation. Others will require up to 10 years’ probation free. A knowledgeable insurance agent can help you navigate through the system to determine which policy suits your needs and your budget.
However, if you’re currently under conviction, on parole, on probation, or incarcerated your odds of qualifying for any insurance policy are slim to none. This is also true if you committed a serious felony, regardless of how long ago your probation ended.
Why Do Insurance Companies Charge More for a Criminal Record?
Life insurance companies determine monthly payment rates according to risk. If you’re in good health and avoid risky habits and activities such as smoking and rock climbing, your premium payments are lower because there’s less chance of the insurance company paying out a claim. And statistics show those with a felony have lower life expectancy rates.
Alternative Life Insurance Options
Term Life: If you have misdemeanors or a recent DUI or DWI, consider buying a term life policy. Term life insurance offers coverage for specific lengths of time like 10, 20, or 25 years. While you may pay a bit more than the regular rate in the short term, you can convert your policy to a lower rate later when you are in a better legal position.
Final Expense: For felons unable to obtain a standard policy, final expense insurance may be a good option. Final expense is a type of life insurance policy that is generally used to cover burial costs. It has a lower payout of around $25,000 but costs a lot less than a standard life insurance policy. And they do not require a medical exam.
As tempting as it may be, if you have a criminal record, don’t lie on your insurance application. Life insurance companies do conduct criminal background checks. Even if you have a minor offense on your record, be upfront about it.
If you are honest, a past crime doesn’t have to prevent you from protecting your family.