The need to undergo a medical exam is all the reason people need to procrastinate and procrastinate until they altogether forget about buying life insurance. After all, who wants to voluntarily take time off from work, have a paramed come and ask invasive questions, and give blood and urine samples? Obviously, most people don’t want to do this, which is precisely why no exam life insurance policies have become increasingly popular over the years.
No exam policies are just what they sound like: policies that provide coverage without the need for a medical exam. There are many different types of no exam policies on the market today. Some use sophisticated algorithms that draw from public pharmacy and driving records so that underwriters can calculate risk even without a medical exam. Others ask very few health questions and adjust premiums to reflect the larger assumed risk. And still others ask no health questions at all and grant immediate approval.
What Kind of No Exam Policy is Right For You?
With so many options on the table, how can you figure out which type of no exam policy is best for you? The experts at Sproutt have helped us break down the different types of no exam policies and who they are best for.
This is a type of term no exam life insurance that requires applicants to disclose health information, but because there is no medical exam, it is typically more expensive than its traditional term counterpart. A good rule of thumb to keep in mind is this: the more an insurer knows about you, the more affordable your coverage will be. The less they know about you, the higher your premiums will be, since they are taking on more risk.
With Simplified Issue, there is some underwriting involved, so premiums will be somewhere in between a policy that is fully underwritten and a policy that involves no underwriting at all. You can get a free quote here to get an idea of how much a Simplified Issue policy will cost based on your personal information.
Simplified Issue policies usually offer coverage until $500,000, though some insurers offer until $1 million. In addition to health, other factors insurers consider include:
- Dangerous job or hobbies
Medically Underwritten Policies
These policies are less expensive than SImplified Issue because, as the name implies, they are medically underwritten. While medically underwritten policies usually require a medical exam, there is a subset of applicants that can qualify for skipping the exam. These applicants are generally people who are in excellent health.
Once you submit an application for this type of policy, you will be notified immediately as to whether you need a medical exam or not. Of course, people who want no exam life insurance may not be willing to take the risk of having to undergo a medical exam and may opt for a different policy for just this reason.
Guaranteed issue is a type of whole life insurance that virtually anyone can be approved for, regardless of health. No health questions are asked and approval is given on the spot. The main caveat with this type of insurance is that coverage is limited to $50,000. In many cases, this type of insurance policy is used to cover final expenses (ie, funeral costs) specifically because the coverage doesn’t go that high.
Other things to consider regarding Guaranteed Issue is that often the death benefit is graded, which means that your beneficiary will only receive the full death benefit if you die after two years of policy purchase. If the policyholder dies within two years, the beneficiary only gets a portion of the death benefit.
As a type of whole life insurance, Guaranteed Issue typically comes with higher premiums than Simplified Issue. Plus, here the insurer takes on very high risk since no health questions are asked. Due to the high costs, this type of insurance is best for people who have been denied other types of coverage but still want to leave something to their loved ones.
Choosing the Best Policy For You
While nothing is set in stone when it comes to life insurance, there are generalizations that are usually true regarding the type of people that generally go for certain policies.
People who want a 100% no exam life insurance policy would do well with Simplified Issue. This type guarantees no medical exam, the coverage goes higher than Guaranteed Issue, and it’s less expensive as well.
People who want more affordable life insurance coverage can choose Medically Underwritten and hope that they qualify for the no exam version. This makes it best for people who are in good health. People who aren’t in great health can still qualify, but they will most likely need to have a medical exam.
People who have significant medical conditions but still want coverage will do best with Guaranteed Issue, which offers limited coverage but doesn’t ask any health questions.
It may seem complicated to find the policy that matches your needs, but knowing what’s out there is the first step. Then, it doesn’t need to take long to get some quotes and make a decision. The main point is that you get crucial coverage so that your loved ones will be protected in case of disaster.