Risk is an important factor in any form of insurance - including life insurance. Insurance companies use the principle of “pooling” risk. Everybody has some degree of risk, and that’s why they take out insurance. The premiums that each person pays go into a pool of funds from which claims are paid out when unfortunate events occur.

To keep this fair, premiums are calculated according to your individual risk profile. The likelier you are to claim from the pooled funds, the greater your contribution to the pool should be. Despite this, there can be times when the pool simply isn’t big enough to cover all the claims being made. In that case, the insurance company must contribute funds to make up the shortfall. And, at the same time, every insurance company has its own running costs to cover.

Risk and Insurance: History to Present

The principles of pooling risk, and funds that protect people against risks, aren’t anything new. Mutuals and friendly societies work along similar lines, and the origins of Lloyds go back to the 17th century. People involved in maritime shipping would gather at Lloyd’s coffee house where they could get the latest maritime news and insure their cargoes against the risk of their being lost at sea.

To illustrate the concept of risk in insurance simply, we can consider motor vehicle insurance. If a person has a history of careless or reckless driving, it seems more likely that they will claim from the pool sooner than other drivers may. That means they will have to make bigger contributions to the pooled resources - and in some cases, their risk profile may be deemed so high that they aren’t eligible for insurance at all.

The process that goes into deciding whether a person can be insured and if so, at what cost, is therefore termed risk assessment.

What is High-Risk Life Insurance?

Insurance companies have the expertise to make risk assessments. When looking at risk in terms of life insurance, a great many factors come into play, for example, your age, your health status, the type of job you do, and even your leisure-time activities.

Would you be classified as a high-risk customer in the eyes of insurance companies? You may fall into a high-risk life insurance category if insurers feel that your health status places you in a high-risk category. Or, they may determine that you confront other potentially fatal risks because of your profession, hobbies, or lifestyle.

If you’re considered to be a risky prospect, you may find that it takes longer to get insurance because underwriters need more time to calculate your risk profile; have difficulty getting your insurance application approved; or find that you must pay higher premiums than other people do.

What is Considered a High Risk For Life Insurance?

Here’s what insurance companies look out for when identifying people as high-risk.

1. Pre-Existing Health Conditions

When someone has a health condition, assessing risk can be very complicated and it takes a skilled person to look carefully at the applicant’s medical history.  It is not an exact science but is based on evidence coming from years and years of analysing lots of data.

If the medical history is too complicated, then the applicant can be considered too high risk and may not qualify. However, if there is a health condition and it is being well managed, then it is possible to get insurance even if the policy is a bit more expensive than it would be for someone who is in perfect health.

Some conditions aren’t serious.  For example, you may have had your tonsils removed and are fine now. Other conditions have a more permanent impact even if well-managed. For example, Type 1 diabetes since childhood could mean a lifespan that is shortened by 18 - 20 years.

Traditionally, insurance companies ask for lots of information about these conditions and take a long time to complete the risk assessment. That’s because it must be attended to by a skilled underwriter who has plenty of other risk assessments to attend to.

If you have health issues that may shorten your life, general insurance companies will see you as presenting a higher risk. Illnesses like autoimmune disorders, cancer, and even Type 2 diabetes are seen as red flags. Additional health risks like morbid obesity and smoking contribute to a higher risk profile.

If you have a pre-existing health condition that you're managing well, you may find this rather unfair. For example, a person with diagnosed Type 2 diabetes who is taking good care of their health can live a long life - certainly longer than someone who has diabetes, is undiagnosed, and isn’t doing anything to manage their condition. And there are a lot of people with undiagnosed Type 2 diabetes out there.

You’ll find that most insurance companies who aren’t specialised in the specific risks posed by Type 2 diabetes are at least somewhat willing to take this into account. But once you’ve been diagnosed, they’ll want more information - a lot of it, and they are likely to take a lot longer to process your life insurance application.

Other companies, like Blueberry Life, a company specialising in life insurance for people living with Type 2 diabetes, are focused on making things easier for their clients. They use the latest technology and medical knowledge to make the whole process simpler while still offering a competitive premium.

2. You Have a Risky Job

If you're in military service and are on active duty in a dangerous part of the world, do certain types of scuba-diving jobs, certain construction jobs, or maritime work, there’s evidence that you have a greater chance of a very serious accident at work compared to an office worker, for example.

Indeed, the highest number of fatal workplace accidents in 2023 affected people working in the construction industry. If you work in a potentially high-risk industry, your prospective insurer is likely to want to know more about what you do before setting a premium - or deciding if you are eligible to be insured.

3. You Have Risky Hobbies

Love those adrenaline thrills? They’re likely to have unexpected costs - including more costly life insurance. Motor racing, sky-diving, rock climbing, scuba diving, and any other hobby that might result in a fatality if things go wrong, make you a high-risk life insurance candidate.

You can sometimes get around this by choosing a policy that simply excludes cover for high-risk activities, and since you don’t participate in them every day, you might decide that you are comfortable with that.

4. You’re Older Than Most Applicants

Last, but not least, just being older than the average candidate increases risk. As we get older, we have fewer remaining years. It’s just a fact of life.

So, the older you are when you start a life insurance policy, the higher the life insurance premiums you’ll be asked to pay. This also means that if you bought a policy a while ago and it is now coming to an end, buying a new one will be more expensive than your previous policy was.

Life Insurance Risk Classes: Once High Risk, Not Always High Risk!

When you apply for a life insurance policy, your application is allocated to a risk class based on your risk profile. For some people, it’s possible to change that classification. An overweight person can lose weight, for example - or a person with a pre-existing condition might recover or be able to demonstrate that their condition is better managed than it used to be.  

If you smoke, giving up smoking is the best way to reduce your risk – saving you money on your premiums as well as on cigarettes! It’s worth working towards a lower risk profile - after all, higher risks mean higher premiums.

Life Insurance for High-Risk Individuals: Tips

If you fall into one of the categories that make you a high-risk candidate when applying for life insurance, our top tip for you is to do your research and decide what’s important to you.  

For some people, this will be finding the cheapest offer no matter how long it takes. For others, it will be the attraction of a straightforward application and having the peace of mind that their loved ones are provided for, even if it’s not necessarily the cheapest premium. We believe that these goals can be unified - reasonable pricing and rapid approval should be possible, but it does require a degree of specialisation, which brings us to our next point.

There may be life insurance companies who specialise in insuring people with your type of risk profile. They’ll be geared to process applications from people with situations similar to yours and are likely to handle your application much faster as a result. That’s more important than you might think. Waiting for months after obtaining and submitting multiple pieces of evidence only to find that you still get offered expensive life insurance or are turned down is extremely frustrating.

As we just mentioned, you can also try to lower your risk profile. Lose weight. Quit smoking. Ditch the risky sports and hobbies. Switch to a safer profession. Show that your health prognosis is good, and so on. No matter who insures you, they should be willing to take these factors into account when determining your risk profile and the premiums you’ll pay in exchange for the cover your family needs.

Life Insurance For Type 2 Diabetes

Health professionals know that early detection and good management improve outcomes for people living with Type 2 diabetes. Most insurers know that too, but they will ask you questions to be sure of this so as to be fair to you and other policyholders. If you are taking good care of yourself, you wouldn’t want to pay the same as someone who isn’t!  

Historically, the whole process takes time, and you might find that navigating it is uncomfortable. Maybe you have to give them access to your medical records, which they take months to get around to. Perhaps you’ll be asked to go for numerous health tests you don’t really have time for. And in the end, you might not feel that you’re being offered a fair premium.

That’s why Blueberry Life came into being. We know that one in every 16 people in the UK are living with Type 2 diabetes. Only a third of them will need insulin therapy, and even if they do, following doctor’s orders keeps them healthy. In the end, the average person with Type 2 diabetes is likely to have a lifespan that’s only two years less than a person without Type 2 diabetes. And that’s just an average. Some people take such good care of themselves after their diabetes diagnosis that they may actually live longer than they otherwise would have.

At Blueberry Life, we specialise in life insurance for chronic conditions, like Type 2 diabetes, and we recognise you as an individual. We believe that you deserve rapid insurance approvals, fair premiums, and a minimally invasive process to determine your risk profile.

Our application process is quick and easy, and we’re confident that you’ll find our cover to be a perfect fit for you. We specialise in life insurance for chronic conditions because you deserve a fresh take on your risk profile. Apply today.