We are sure you have heard of “No-exam life insurance” but are you confused on what it is? Well No Exam Life Insurance is insurance that does not require a medical exam to obtain coverage.
Typically, these types of life insurance policies are designed for healthy, young (typically under 50 years old) life insurance buyers. Even if your health or age disqualify you from a no-exam policy, the company may still consider you. Alternatively, they might offer to do a medical exam as part of the underwriting process.
You should be prepared that a no-exam life insurance company may need more details about your current and past health, as well as an examination if you apply for it.
No-Exam Life Insurance Options
Accelerated underwriting life insurance
Accelerated underwriting life insurance is a process where the proposed insurer gathers information about you via an online application and then algorithms quickly assess what your life insurance quote should be.
Simplified issue life insurance
Simplified issue life insurance is a type of life insurance where firms use a simplified approach to underwriting. These policies usually include various well-being questions and do not need medical exams. Simplified issue policies are likely to cost more because the insurer has less knowledge about you.
Guaranteed issue insurance
Guaranteed issue life insurance policies offer coverage with no medical exam and no questions. You can not be refused a policy. Guaranteed issue life insurance is intended primarily for senior citizens looking to cover final expenses. These policies generally have reduced maximum coverage amounts and a graded death benefit, meaning they won’t pay out the whole policy amount if you perish in the first few years of owning the policy.
Guaranteed issue policies are generally the most expensive way to buy life insurance, because no one is turned down.
How Do You Know Which Coverage is the Best for You?
Calculate how much life insurance you need
A no-exam life insurance policy may not be able to provide the full coverage amount you need, especially if you’re looking to cover many working years or the years of raising a family.
Before you start getting life insurance quotes, calculate how much life insurance you need. A no-exam policy alone may not be able to provide sufficient coverage.
Know your chances before you apply
Obtaining life insurance without a long application process can sound almost too good to be true, but before making assumptions that you will get approved you will need to understand how you are and why you may or may not get approved. Most no-exam policies require that the applicant has very good or excellent health for approval. If you are denied you will need to be aware that a denial goes on your insurance record and could hinder future applications.
Don’t be surprised if you end up doing a more traditional application process, including a life insurance medical exam if you’ve had some health issues.
There is more to consider than just cost
Of course you don’t want to overpay for life insurance, but research more than cost. There are coverage options that can be very valuable long after you buy the policy, such as the option to convert term life to permanent life insurance. Also, look at whether there’s an accelerated death benefit, which gives you access to money from your own death benefit if you become terminally ill.
Be fully honest on the application
No matter what type of life insurance you’re applying for, be thorough and truthful on the application.
Its important to really pay attention to each question listed and be prepared to respond with all the information around specific medical conditions you have. Providing more detailed information will help smooth out the process as well as get a more accurate decision from underwriting.
Misrepresentations may result in application denials or, worse, denial of a claim after your death. The information provided on applications is verified in many ways by life insurance companies. Technology on the backend allows them to verify data from additional sources.
Rejected? Here are some Back Up Plan tips
Regardless of whether a company rejects your application for no-exam life insurance due to your health, don’t give up on looking for life insurance. If you need life insurance, you likely have other routes.
It’s likely that you’ll have to undergo a more traditional underwriting process, which includes a medical exam for life insurance.
A life insurance agent who has experience with your specific health conditions can help you identify insurers who are more suited to your needs.
Your application can be shopped around anonymously by an experienced life insurance agent to avoid another rejection.