In Canada, laws such as the Canadian Human Rights Act and provincial/territorial human rights codes prohibit discrimination based on sexual orientation and gender identity. As such, members of the LGBTQ+ community are entitled to the same life insurance options as every other Canadian. However, there are a few things to be aware of if you identify as LGBTQ+ and are shopping for a life insurance plan.
Can an LGBTQ+ Person Buy Life Insurance?
Yes, they can purchase life insurance and under Canadian Law, they must be offered the same insurance products at rates comparable to those offered to cisgender heterosexual people. The life insurance industry does, however, lag slightly behind other organizations when it comes to some aspects of equitable treatment because they are dependent on historical data that do not include the full range of gender identities that are recognized today.
Life Insurance for People Who Identify as Nonbinary or Genderqueer
The insurance industry recognizes and celebrates individuals who do not identify as either male or female. However, people who identify as nonbinary or genderqueer must still apply for life insurance under the gender they were assigned at birth.
Some background on the rationale for this might help in understanding it. Pricing for insurance policies is based on decades of data about the relationship between various personal factors and life expectancy, including lifestyle, overall health, pre-existing conditions, and gender. Smoking, for example, is a lifestyle factor that tends to decrease life expectancy. Therefore, if a smoker and a non-smoker apply for the same life insurance product, the non-smoker will get a more favourable rate, all other things being equal. Gender is another factor used to estimate life expectancy. Historical data show that men have shorter life expectancies than women; therefore, the same product will be priced higher for men than women. Because there are insufficient data about the full range of gender identities, insurance companies continue to use a binary gender model for pricing. Although this is far from ideal, the insurance industry is working hard to amend the situation so that the application process for life insurance is more equitable and inclusive.
The good news is that rates for men are only slightly higher than rates for women, so applying under the gender you were assigned at birth will not be unduly onerous. More inclusive options will become available as more data about diverse communities become available.
Special Considerations for LGBTQ+ Individuals
There are a few additional considerations that LGBTQ+ individuals should be aware of when shopping for life insurance.
- Transgender people who are preparing for gender-affirming surgery may have to wait until after the surgery to apply for life insurance. Due to the possibility of complications following major surgery, insurance companies will not always agree to insure someone who is about to undergo this type of care.
- Transgender people are more likely to be diagnosed with a mental health disorder, largely due to the high levels of discrimination, bullying, and social rejection they face, which can lead to depression and anxiety-related disorders. Due to this increased risk, insurance providers may require further assessment of a transgender applicant to ensure that their mental health is not in danger.
It is important to note that if an insurance application requires a medical exam, testing, and a health questionnaire, the insurer will have access to historical medical records for the applicant, including any mental health challenges that the applicant has had. Opting for a policy that does not require medical exams or tests may be the best solution if you do not want your medical history to be shared.
Life Insurance if You Are HIV Positive
Traditionally, life insurance companies have considered HIV a high-risk condition and may have denied applications from people living with HIV or offered limited coverage at higher rates. With advances in medical treatments and improved life expectancy for people living with HIV, insurance companies have started to reconsider their approval and pricing policies. As more data about life expectancies for HIV-positive applicants becomes available, we can expect to see life insurance providers update their underwriting practices.
People living with HIV may have challenges finding a plan that suits their needs, but will have less trouble with policies that do not require medical exams or tests:
- Guaranteed acceptance life insurance: This type of policy does not require any medical questions or exams, and acceptance is guaranteed. Coverage amounts are typically lower, and premiums can be significantly higher, but this is a good option for anyone who wants to get insurance quickly and without complications.
- Group life insurance: If your employer offers a group life insurance policy, you may be able to obtain coverage through this plan. Group policies often do not require medical exams or extensive health questionnaires.
By law, members of the LGBTQ+ community are entitled to purchase the same products and services as cisgender heterosexual people. However, they still face some obstacles when shopping for these policies, including having to choose between one of only two genders and disclosing their medical history. However, these issues should be resolved soon as the insurance industry continues to collect data about people who identify as LGBTQ+ and the factors that correlate with their life expectancies.
Canada Protection Plan respects the dignity, privacy, and individuality of its LGBTQ+ clients and the larger LGBTQ+ community. As one of Canada’s leading providers of No-Medical and Simplified Issue life insurance policies, we accommodate people who don’t fit the traditional moulds that are prevalent in current underwriting practices. With us, you can expect personalized contact that acknowledges who you are as an individual and the challenges you face.