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According to a recent Gallup poll, a record number 18 million adults identify as LGBTQ. Among adult LGBTQ individuals, 11.3% identify as transgender.

While society is becoming more accepting, transgender adults are still often faced with confusing or contradictory guidelines when it comes to their legal rights and options. Some states provide transgender people with the same rights as cisgender people (those who identify as the gender listed on their birth certificate) and others do not.

For life insurance, you may be wondering what kind of challenges transgender individuals may face. Well, being transgender will not necessarily cause you to receive more expensive life insurance quotes.

Just like cisgender people, your age, past and current health (both physical and mental), along with your lifestyle and employment history, will impact your term life insurance rates. You may be considered to be within the Preferred (or low risk) class of applicants if you are a healthy, non-smoking, transgender person. Let’s dig into the process of buying life insurance as a transgender individual a bit more.

How does being transgender affect buying a life insurance policy?

With some life insurance companies, transgender individuals may be classified as male by some carriers and as female by others. Some life insurance companies, however, are more amenable to working with your definition of yourself as transgender.

Generally, when someone applies for life insurance, if their assigned sex at birth was female, they should apply as female, and if their assigned sex at birth was male, they should apply as male. This would include individuals whose gender identity differs from their assigned sex at birth, but who have not undergone any medical or physical transition.

When a person is using (or has used) hormone therapy treatment and/or has had any gender-affirming surgeries, it will not only affect the rates for which they apply, it may also affect the requirements needed during the underwriting process.

If you have transitioned or are in the midst of, the following factors will be evaluated by the insurance company:

  • The stage of your transition
  • Whether or not any drug therapies used—or that you will continue to use—are experimental (and therefore may have unforeseen side effects)
  • If your surgery and/or drug therapies resulted in health issues that are likely to continue

These factors along with the typical age, occupation, and hobby factors are considered when determining the risk class given to an individual. The medical records of a transgender individual will be ordered and reviewed.

» Calculate: Life insurance needs calculator

Laws that Protect Transgender Life Insurance Rights

Many states have taken huge strides towards clarifying the legal standing of LGBT people in their states. That means that the life insurance industry—which has often led the way in inclusive policies—is now navigating a range of regulations and standards designed to make finding term life insurance as a transgender person easier.

For example, some states have codified more inclusive definitions of gender:

In California:

“Gender” means sex, and includes a person’s gender identity and gender related appearance and behavior whether or not stereotypically associated with the person’s assigned sex at birth.” California DOI 2007-02

“Existing law authorizes a person who was born in this state and who has undergone clinically appropriate treatment for the purpose of gender transition to obtain a new birth certificate from the State Registrar.”
Senate Bill No. 179 Chapter 853

And in Delaware:

“Gender identity” means a gender-related identity, appearance, expression or behavior of a person, regardless of the person’s assigned sex at birth. Gender identity may be demonstrated by consistent and uniform assertion of the gender identity or any other evidence that the gender identity is sincerely held as part of a person’s core identity; provided, however, that gender identity shall not be asserted for any improper purpose. Delaware, S. 97, 2013

This means that companies in these and other states with similar definitions of gender and gender identity can be held accountable to uphold relevant non-discrimination standards in their business practices.

However, the interpretation of how those standards apply to the underwriting of life insurance policies for transgender people has been under debate within the industry for some time.

Fortunately, many states have taken steps to make the interpretation of these laws easier as well.

For instance, Delaware has created comprehensive guidelines for life insurance companies with regards to transgender and transexual applicants. As we’ve seen above, Delaware law accepts that gender identity is not necessarily the gender that you were assigned at birth.

Since discrimination based on gender identity is prohibited by state law, this also applies to business practices within the insurance industry.

“No person shall make or permit any unfair discrimination between individuals of the same class and equal expectation of life in the rates charged for any contract of life insurance or of life annuity or in the dividends or other benefits payable thereon, or in any other of the terms and conditions of such contract.”

No person shall make or permit any unfair discrimination between individuals of the same class and of essentially the same hazard in the amount of premium, policy fees or rates charged for any policy or contract of accident or health insurance or in the benefits payable thereunder, or in any of the terms or conditions of such contract, or in any other manner whatever.”

In New Jersey, the law is even more explicit:

“No person shall make or permit any unfair discrimination in the issuance, extension, or renewal of a life insurance policy or in the fixing of the rates, terms, or conditions of a life insurance policy, against an individual on the basis of:

(1) an individual’s transgender status, including a diagnosis of gender dysphoria and any related medical treatments; or

(2) any apparent incongruence between the individual’s gender identity and the individual’s sex assigned at birth, or the gender designated in the individual’s insurance application or records or other identification documents.”

This means that in states with non-discrimination laws protecting transgender and transexual people, insurance company underwriters cannot discriminate against you—or place your application in a higher risk class of applicants—if you match the criteria of a Preferred class (or very low risk) applicant.

Don’t let the uncertainty of LGBT anti-discrimination laws keep you from applying for term life insurance.

At Quotacy, we’re sensitive to the challenges that transgender people may face while searching for life insurance quotes and eventually finding the right policy. Our agents are always ready to help if you’ve decided to become insured and have some questions.

Life Insurance Companies Responses Vary to Transgender Applicants

We recently worked with an applicant who had surgically transitioned from male to female. We completed an underwriting study—which is when we go to the different life insurance companies and ask what they think they could offer our applicant—and the responses varied.

Some carrier responses included the following:

Please note the statements are the unedited responses of underwriters at some of our life insurance companies and do not reflect the views of Quotacy as a company.

  • We may issue Standard male rates assuming no history of depression, anxiety or other issues.
  • We may issue Preferred male rates pending on medical history.
  • We may issue Preferred female rates pending medical records and that applicant is following post-surgery requirements such as counseling and hormone therapy.
  • We cannot issue until 3 years post-surgery and would rate as female then.
  • We would generally issue male rates, but will consider female if applicant feels it’s more appropriate.
  • Whatever gender the applicant applies as is the one we will use.
  • We always underwrite as the gender they were born with.

As you can see, no two life insurance companies are alike.

Each life insurance company follows their own set of underwriting guidelines and works on a case-by-case basis. It is our goal at Quotacy to help you find the life insurance policy that fits you best.

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What are your life insurance options?

The two most common types of life insurance are permanent and term life insurance.

Characteristics of Permanent (or Whole) Life Insurance

  • Provides coverage for your entire life
  • Builds up cash value over time
  • Expensive

Whole life insurance is a good option for:

  • Families with special needs dependents who will need care throughout their lives
  • Small business owners look to secure their company’s future and equalize inheritances
  • Advanced age seniors those who wish to protect their partner or dependents and cannot qualify for term life insurance
  • Those with medical conditions which disqualify them from term life insurance (these applicants may seek final expense life insurance)

» Get: whole life insurance quotes

Characteristics of Term Life Insurance

  • Offered in specific term amounts such as 10, 15, 20, 25, 30, 35, and 40 years
  • Affordable and customizable
  • Can be laddered (purchased in multiples) to customize coverage for your family’s needs

For most people, term life insurance is the best choice.

Ready to get your quotes? With Quotacy, it’s incredibly simple.

Click through to our life insurance quotes tool and answer a few questions such as your age, zip code, smoking status, and how much coverage you’d like to apply for. No need to enter any contact information. You’ll see a range of quotes instantly.

If you want to see a more customized quote, just answer a few more questions and you’ll get a range of quotes from leading insurance companies within a few seconds. See a policy that you like? You can finish your application in less than five minutes.

That’s it. Easy and painless.

At Quotacy, we believe in inclusion, and not just during Pride Month. We do our best to match all of our clients with the best possible term life insurance plan for their needs. We will go to bat for you to get your family the protection that they deserve.» Learn more: Navigating Term Life Insurance for Domestic Partners and Families

About the writer

Headshot of Natasha Cornelius, a life insurance writer, for Quotacy, Inc.

Natasha Cornelius, CLU

Senior Editor and Life Insurance Expert

Natasha Cornelius, CLU, is a writer, editor, and life insurance researcher for Quotacy.com where her goal is to make life insurance more transparent and easier to understand. She has been in the life insurance industry since 2010 and has been writing about life insurance since 2014. Natasha earned her Chartered Life Underwriter designation in 2022. She is also co-host of Quotacy’s YouTube series. Connect with her on LinkedIn.