Life Insurance for SSI Recipients

SSI recipients can still get great life insurance coverage. Life insurance for SSI recipients can be based on a number of different factors. Most importantly, you need to decide if you want term or permanent life insurance. Term policies won't affect your SSI benefits, but permanent policies could reduce your benefits. Read more to learn everything you need to know to navigate your SSI benefits and life insurance coverage.

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Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in...

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Benjamin Carr was a licensed insurance agent in Georgia and has two years' experience in life, health, property and casualty coverage. He has worked with State Farm and other risk management firms. He is also a strategic writer and editor with a background in branding, marketing, and quality assurance. He has been in military newsrooms — literally on the frontline of journalism.

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Reviewed by Benji Carr
Former Licensed Life Insurance Agent

UPDATED: Dec 14, 2020

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Quick Facts

  • SSI recipients can still buy life insurance policies, but their income will be used as a factor to determine how much coverage they qualify for.
  • Life insurance policies with cash values that can be borrowed against can affect the amount of SSI you receive.
  • Term life and final expense life insurance policies have no cash value and will not be held against in the eyes of the Social Security Administration.

If you are a SSI recipient, you may be wondering if you can get a life insurance policy. You may be wondering if owning a life insurance policy will count against you and your ability to recieve SSI benefits. Life insurance for SSI recipients won’t affect your ability to recieve benefits.

SSI benefits are available to people who are disabled, blind, or aged 65 years or older. The Social Security Administration takes into account a number of factors including assests and income when determining qualifications for SSI benefits.

There are many types of term life insurance policies, and some permanent life insurance policies have a cash value that can be borrowed against. In the eyes of the SSA, this is a potential source of income and as a result will reduce the amount of SSI benefits you can receive.

If you’re ready to start comparing life insurance quotes for SSI recipients in your locality, enter your ZIP code above. Not yet ready to buy life insurance for SSI recipients? Read on to learn more.

Social Security vs. Life Insurance

Should you get life insurance or apply for SSI benefits? These two things do not have to be mutually exclusive. In fact, if you do or can recieve SSI benefits, you should still get a life insurance policy, as well.

Many people ask, does life insurance affect Social Security survivor benefits? The answer is no. Social Security survivor benefits are based on the amount of money the deceased paid into the program over the course of their lifetime. Their life insurance policy will not affect this.

What can affect your Social Security survivor benefits is your own employment. If you are currently under the age of retirement and working, your Social Security survivor benefits may be reduced depending on your annual income.

Does life insurance payout affect SSI benefits?

If you are the beneficiary of a life insurance policy and receive SSI benefits, you might be worried that your SSI and life insurance inheritance will affect one another.

In most cases, a life insurance beneficiary receives a one-time payout. This doesn’t amount to a change in your income situation. However, the added financial assests may lead the SSA to pause or reduce the amount of your SSI benefits for a short time while the insurance benefits are used.

Does life insurance affect Medicaid?

Medicaid is a social program providing health care to low-income individuals. Life insurance should not affect your Medicaid coverage in any way.

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Does whole life insurance affect SSI?

Whole and permanent life insurance policies can affect the amount of SSI benefits you receive. The reason is whole life insurance policies carry a cash value that can be borrowed against.

The SSA weighs the amount of income an individual has when deciding how much SSI they can recieve. Whole life policies are classified as income since they carry a cash value.

If you have a whole life insurance policy, you may not qualify for SSI benefits, or the amount of benefits you receive may be reduced. SSI will not affect your SSI life insurance beneficiary.

Can SSI recipients get great life insurance coverage?

Just because you receive SSI doesn’t mean you cannot get a great life insurance policy. Let’s take a look at average life insurance rates across the U.S.

Average Monthly Life Insurance Rates by State
StatesAverage Monthly Life Insurance Rates
Maine$47
New Mexico$48
West Virginia$49
Oregon$50
Kentucky$56
Oklahoma$56
Arkansas$57
Montana$57
Washington$58
Idaho$59
Vermont$61
Arizona$63
Indiana$64
Washington, D.C.$67
Michigan$68
Rhode Island$68
Mississippi$69
Ohio$69
Nevada$70
Tennessee$70
South Carolina$71
Wisconsin$71
Missouri$72
New Hampshire$72
Alabama$75
Texas$75
North Carolina$76
Virginia$76
Georgia$80
Kansas$80
Colorado$83
Florida$83
Louisiana$84
Pennsylvania$84
Maryland$85
North Dakota$88
California$90
Iowa$91
Nebraska$93
Massachusetts$95
Illinois$97
Utah$98
New York$108
Wyoming$113
Connecticut$114
Hawaii$124
New Jersey$126
Alaska$139
Minnesota$151
Delaware$213
South Dakota$221
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Your SSI will affect the amount of coverage you can get out of your life insurance policy since underwriters look at income when determining how much coverage you can get.

Conversely, if you have a whole or permanent life insurance policy, this may reduce the amount of SSI you can recieve since the SSA classifies these policies as income due to their cash value.

It is important to shop around for life insurance coverage. Check in with a number of different companies so you can get the best policy at the most competitive rates.

When you’re ready to start comparing life insurance rates for SSI recipients in your area, enter your ZIP code below. Which life insurance company for SSI recipients is for you? Find out now.

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