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Is it wrong to purchase long-term disability insurance knowing you will need it?

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Suppose you know for sure as a result of your own self-diagnosis that you have a disease that will eventually lead to your becoming disabled, but due to lack of worthwhile treatment options in the standard healthcare system, you haven’t sought medical attention from these channels, and there is nothing in your medical records to prove it. Also say that doctors have such a hard time apprehending your condition that you would have a difficult time proving it if you tried. As a result of which, you could get an insurance company to sell you a long-term disability policy without lying on any questionnaires or paperwork. Is it still immoral since you’re buying the policy knowing the insurance company would not sell it to you if they knew what you know? 

Edited by happiness
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You say "long-term disability", but long term care is quite similar.

Your hypothetical is extremely unrealistic. I replace "you" with "X" in what follows. X expertly diagnoses his own condition and knows he is a big LTC risk. However, no other doctors can understand it. X also assumes the insurer's underwriting will be totally incapable of detecting X's condition and its LTC risk. 

What sort of symptoms is X basing his diagnosis on? And no other doctors can detect or understand those symptoms?
 
Here is an alternative question for you. Is it immoral for X to buy whole life insurance knowing with certainty that X is going to die some day? 

I am not an expert on LTC insurance. However, 84 percent of new policy sales combine life insurance with a LTC benefit (link). Any LTC claims will reduce the amount payable on death. This surely mitigates the risk to the insurance company.

FYI, this application https://www.sunnet.sunlife.com/files/advisor/english/PDF/810-3523.pdf is for one company's LTC insurance. Note especially questions 3 and 9b.

Edited by merjet
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Is the value of honesty intrinsic, devoid of any thought of consequences? Do you have fundamental duty to be honest without any connection to the affects? This is all a game of risks and consequences, the ethics follow that.

The deal is "bet on my situation" because I will tell you the truth.

  • An insurance company will bet on the fact that you "might" tell the truth. Meaning, lying is factored in to their over all calculations.
  • The fundamental question is "is it wrong for you to lie that you KNOW something". Well, what are the long term consequences for you?
  • If you will be dooming yourself to a life of horrible consequences, it is your responsibility to prevent it. The question is "could they find out and rescind your benefits when you are to get them"?

Kind of like you are dating someone and you feel you have to tell the other person everything that is wrong with you. All in the name of being honest. Sometimes yes and sometimes no. Meaning if the other party finds out at some point, the consequences may be bad.

And granted, we never know how much or who we are hurting when we lie but an insurance company is set up (or should be set up) to make it hurt the least possible.

Assuming that you say "I must be honest". Fine, but what if you are wrong and you end up being a good risk? Then you would have shortchanged yourself. Maybe a cure is discovered tomorrow, how do you know? Then the LTC was a waste of money but you would not have recourse. In the same way, you have to do what you have to do.

Bottom line it is a risk that you will have to take. As the insurance company is taking a risk on you.

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I think you can answer the question by answering a related question: is it moral to sell your house without putting together a list of every bad thing that you can imagine about your house, as a warning intended to dissuade buyers? If you happen to say “yes”, I suppose that you should ask yourself related questions about any business that you might deal with, for example is it moral for an insurance company to ever deny a claim? Of course it is, you can read the policy to see what is covered and what is not covered. If the policy says that “denial of service due to officially-declared epidemic emergency shall not be covered”, you were told. If it doesn’t say that (or similar thing), you were not told and it would be immoral (and illegal) to deny coverage for a cancellation arising from The Bug. Perhaps the company didn’t think about the possibility of an epidemic and will change its practices in the future. You are entitled to act as though the company has thought of all of the factors relevant to their offer of insurance, that is, you are entitled to assume that they are acting in their own rational self interest, and you are entitled to act the same way.

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  • dream_weaver changed the title to Is it wrong to purchase long-term disability insurance knowing you will need it?
17 hours ago, happiness said:

Is it still immoral since you’re buying the policy knowing the insurance company would not sell it to you if they knew what you know? 

How do you know they wouldn't?

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I have a serious degenerative condition that I'm certain of due to the history and symptoms. However, for 15 years, it has remained in such an early stage that there is minimal definitive imaging evidence, and I've never had a firm diagnosis. Where I left off trying half a decade ago, I could not get a doctor in the healthcare system to document my condition. It already is disabling in that it cuts me off certain activities and vocations, and I've had to create a lifestyle that accommodates these limitations. I know it will eventually get worse. My current employer provides LTD insurance, but I recently came up with a new career interest in a field that wouldn't likely provide it as far as I know, so I would have to buy it independently.

I'm not trying to be moral for the sake of wearing a halo around my head, I know that making immoral choices has endangering consequences. If I know I have a serious pre-existing condition, and buy a portable LTD policy for the sake of taking a risk I wouldn't otherwise, I could be positioning myself somewhere I don't belong.

Sadly I never really thought about this until recently. Even with my employer-provider insurance, I can probably buy a supplemental policy to make the eventual payout larger anyway. 

Edited by happiness
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I'm sorry to hear about your condition. Is it genetic?

Regarding disclosing your condition to a potential insurer, my advice is to honestly answer the questions when applying. The questions on the application I linked appear open-ended and the insurer could follow up on any answers you provide. Note that said application does not want genetic test results. I wouldn't take that as universal and it might be required legalese (link).

I suggest looking into the life-LTC combination. It will likely cost more than either coverage alone. On the other hand, an insurer might be more willing to insure you given the lesser riskiness of that kind of policy to an insurer.

 

 

Edited by merjet
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