Life Insurance and Transgender People

Background: transgender people and life insurance risk

Historically, gender has been a significant factor in the insurance application process. However, the issue extends beyond merely classifying applicants into one of two gender categories. A considerable number of individuals identify as transgender, leading insurers to develop unique approaches for these application scenarios. Let’s delve deeper into this complex subject to gain a better understanding.

Transgender and cisgender are terms used to describe one’s gender identity.

  • Transgender: This term refers to individuals whose gender identity differs from the sex they were assigned at birth. For example, a person might be born biologically male, but identifies and lives as a female. Transgender people may choose to undergo medical procedures, such as hormone therapy or surgeries, to align their physical appearance with their gender identity. However, not all transgender people choose to, or can afford to, undergo such procedures.
  • Cisgender: This term refers to individuals whose gender identity matches the sex they were assigned at birth. For example, a person who is born biologically female and identifies and lives as a female.

There are several key groups within the transgender community:

  • Transgender Women (Male-to-Female): Individuals assigned male at birth but identify and live as women.
  • Transgender Men (Female-to-Male): Individuals assigned female at birth but identify and live as men.
  • Non-binary/Genderqueer: These individuals don’t identify solely as male or female. They may identify as both, neither, or a combination of male and female genders.
  • Genderfluid: These individuals have a gender identity that varies over time. One day, they may feel more male, and another day, they may feel more female.

When it comes to insurance, there are potential risks and considerations associated with gender-changing surgeries, including complications from surgery, ongoing hormone therapy, mental health services, and other related treatments. Furthermore, insurance policies vary widely on coverage for these treatments. Some insurers fully cover gender-affirming surgeries and treatments, while others may not cover them at all, creating financial barriers for those seeking such procedures.

It’s important to note that the way insurers treat transgender individuals and their medical needs is not uniform. Policies and coverage can vary greatly from one insurer to another. Therefore, it’s crucial for transgender individuals to thoroughly research and understand their insurance options.

What sex do life insurers use when calculating premiums for transgender people?

Gender is a significant factor in calculating life insurance premiums. This is because, statistically speaking, women tend to live longer than men. According to World Bank data, the average global life expectancy for women is approximately 75 years, while for men it’s around 70 years. As a result, life insurance rates are generally lower for women.

From a life insurance perspective, identifying as a woman can be financially advantageous due to these lower premium rates. However, the way gender is considered in life insurance policies varies greatly among different insurers. There are typically three main approaches:

  • Gender at birth: Some insurers base their premiums on the insured’s biological sex at birth.
  • Current legal gender: Other insurers might use the gender that the individual legally identifies with at the time of application.
  • Self-Identified gender: Lastly, some insurers may consider the gender that the individual currently identifies with, regardless of their biological sex or legal status.

The approach taken can significantly impact the cost and availability of life insurance for transgender individuals. It’s important for consumers to be aware of these differences and to shop around for the best policy to suit their individual needs. In recent years, there has been increasing pressure on the insurance industry to reassess traditional gender categories and to consider more inclusive practices, but progress varies widely from one company and jurisdiction to another.

BMOCanada LifeDesjardinsEmpire LifeEquitable Life
What rates does your company use when offering life insurance to transgender people?Gender at birth matters.Self-identified gender at time of applicationIf a transition is completed, we use the gender that they identify themselves withGender at birthBased on the gender at birth but a policy can be issued in the gender the client wishes

Are there any additional life insurance premiums associated with being transgender?

In recent discussions with several insurance companies, it has become clear that all are aligned on a key principle: they do not discriminate against transgender individuals by charging extra premiums. Their policies are designed to be inclusive and fair, respecting the rights and identities of all individuals.

What these insurance companies consider more important when calculating premiums is the individual’s overall health and medical history, rather than their gender identity. This includes factors such as age, lifestyle habits (like smoking or drinking), pre-existing medical conditions, and family medical history.

This approach reflects a broader industry trend towards more personalized and inclusive insurance products. It’s a positive step forward, ensuring that everyone, regardless of their gender identity, can access the coverage they need without facing undue financial burdens. However, it’s always recommended for individuals to thoroughly research and compare different policies to find the one that best suits their personal circumstances.

BMOCanada LifeDesjardinsEmpire LifeEquitable Life
Are there any additional premiums associated with being transgender?Not for being a transgender but for any associated medical issues (if it is the case).No.No rating is applied specifically for being transgendered.The company underwrites everyone on an individual case basis using the medical and personal history disclosed to on the application.There are no additional premiums required but an APS is mandatory.

Note: APS = Attending Physician Statement

How do Gender-Affirming Surgeries Affect Life Insurance Rates?

Insurance companies calculate their premiums based on the perceived risk associated with insuring an individual; medical or surgical procedures inherently come with a certain level of risk. This includes both common medical surgeries and gender-affirming surgeries.

In the case of gender-affirming surgeries, insurers treat them fairly similar to any other medical operations. The risks associated with these surgeries, such as complications, the need for follow-up care, and the potential for readmission, are assessed in the same way as other surgical procedures.

It’s important to note that under current law, health insurance companies can’t refuse to cover someone or charge them more just because they have a “pre-existing condition.” This applies to all individuals, including those who are transgender and may be seeking gender-affirming treatments. However, the coverage for specific procedures, including gender-affirming surgeries, can vary greatly among different insurers, as not all procedures are considered medically necessary under every plan. Therefore, it’s crucial for individuals to thoroughly research and understand their insurance options and what is covered under their specific policy.

BMOCanada LifeDesjardinsEmpire LifeEquitable Life
Can applicants apply if gender-affirming surgeries are pending?Yes, for minor surgeries.No.If an applicant has a pending gender reassignment surgery, generally postpone until the surgery has been completed as it is a significant surgery.No one should submit an application when there are pending surgeries to take place.Applicant should apply after surgery is completed.

Are there any additional life insurance application/underwriting requirements for transgender people?

After conducting extensive research on the requirements set forth by insurance companies for transgender individuals, it has become evident that these companies do not impose any additional hurdles for transgender applicants compared to cisgender individuals.

It is important to know that some life insurance companies underwrite transgender applicants based on assigned gender at birth, while others use the applicant’s stated gender at the time of application. However, the exact underwriting requirements vary by insurer, and there’s no specific requirement uniquely applicable to transgender individuals.

The focus remains on the individual’s overall health and medical history, which is standard procedure for all individuals seeking coverage.

BMOCanada LifeDesjardinsEmpire LifeEquitable Life
Are there any additional life insurance underwriting requirements for transgender People?APS (Attending Physician Statement).No, other than everyone’s individual medical history is different, so if surgeries etc. have been done or contemplated, a company would need that information.No additional underwriting requirements, but a cover letter is suggested especially if the client has coverage with Desjardins already, which might be under a different name and gender. When completing the transition, a client may change their name so if they do submit a new application after the transition they could also submit a request to update their name on file. This is to ensure all their coverage is under one client profile.Company follows their traditional age and amount requirements based on the answers provided to the medical or personal history. The company reserves the right to request additional requirements as they do with all applicants.Cannot provide a tentative assessment without benefit of an APS as this is a complex history to underwrite.

Final word: Life Insurance and Transgender People

In today’s world, obtaining life insurance as a transgender individual is no longer a challenge. You are treated just as any other person would be, based on your medical condition and personal history, whether you’re transgender or cisgender. There might be nuances to consider, such as how different insurance companies calculate rates based on gender. This is why we suggest working with a broker who has access to a variety of companies.

LSM Insurance works with more life insurers than most brokerages or MGAs, providing a broad range of options. Our specialists have extensive experience in guiding transgender individuals through the entire application process. At LSM Insurance, we have access to a wide array of policies, from preferred and standard traditional life insurance policies, to various no medical life insurance products like simplified or guaranteed life insurance. We strive to find the life insurance solution that is right for you at the best possible rate.

If you’re interested in getting a quote or simply want to connect for an initial informational chat, please don’t hesitate to contact us. You can do so by completing the form on this screen. We’re here to help you navigate the process and ensure you get the coverage you need.

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