How depression affects your insurance premiums

When taking out life insurance, the general thought is that it is easier and cheaper to get the healthier you are. However, this does not only apply to your physical health, but your mental health as well.
 
According to Hollard Life, as many as one in six South Africans suffer from anxiety or depression. Depression is one of the most commonly diagnosed mental health disorders, yet only one third of sufferers will get the necessary treatment.
 
“This is in part because a lot of people think of depression a simple case of the ‘blues’. But it’s a serious illness that can interfere with your ability to function in your normal daily life so it’s essential to seek medical help and support,” explained Hollard Life.
 
Can you get life cover if you suffer from depression?
 
When taking out life insurance, it is important to make the insurance company aware if you have been diagnosed with depression. Hayley Taylor from Hollard Life pointed out that suffering from depression does not mean that you can’t get life cover, however, it may affect certain aspects of your cover and your premiums.
 
“When an insurer receives your application form they use the information you provide to decide whether to offer you cover, how much cover to offer you and how much your monthly premium will be. It’s essential that you tell your insurer everything about your depression from the very beginning because giving incorrect or incomplete information when you apply could make it difficult for you when you try to claim,” highlighted Hollard Life.
 
How does depression affect your cover?
 
If you have depression and apply for life cover, the insurer will look at a variety of things, including the type of depression, the type of treatment that you have received, and how well you have managed your depression in the past.
 
Among the information that they will require is:
·         Date of diagnosis
·         Method of treatment
·         Past methods of treatment
·         Your doctor’s details
·         Symptoms and dates of last symptoms
·         Details of any previous hospitalisations
·         Details of any suicide attempts
·         Specifics of time taken off work as a result of the condition
 
“Based on the information that you provide about your depression, an insurer may choose to charge you a higher premium. They may also apply what is called a ‘permanent suicide exclusion’, which means that they won’t pay out if you take your own life,” explained Hollard Life.
 
However, Hollard Life pointed out that an insurer may opt to include a ‘depression exclusion’ on disability and income benefits, as “depression and associated conditions like chronic fatigue and fibromyalgia (a disorder that causes muscle pain and fatigue) can leave you unable to work for periods of time.”
 
If you suffer from reactive depression, which is temporary and is a reaction to a particular situation, such as the death of a loved one or post-natal depression, Hollard Life stressed that they will not charge a higher premium for life cover, as long as the depression is successfully treated.