This is true. I am an Life Insurance Agent, and this is my point of view:

If the client were to be found to be aware to have diabetes BEFORE the policy is inforced, then the Insurance company responsible has the right to reject any claims.

If it happens DURING the 1 year period especially, the company may delay the claim with a reason "Pending Investigation" which can take from 3 months till a year at most. This is because the insured 'just so happen' became ill shortly after purchasing.

If it happens over and extended period of 2 years or more, depending on the company, it can be safe to assume that the insured is not aware of the coming illness, and the company is obligated to payout as stated in the policy.