Sometimes the process of getting life insurance can be longer than you want to take. Sometimes you don’t need a lot of coverage. Sometimes you just want to cover your mortgage and have a year’s worth of income to pay bills while making a change after a loved one passes away. For all these reasons and others, life insurance without a medical exam may be the option for you.
What is no exam life insurance?
The answer is in the question really but to clarify it specifically means there is no medical exam required. Generally, you need to have a physical, and blood draw at the least after applying for life insurance.
The results of a medical exam can increase your premiums, however, the convenience of no medical exam life insurance WILL result in a slightly higher premium for the convenience and higher risk to the insurance carrier (but it’s not so significant that it isn’t worth it).
Nonmedical exam life insurance is technically called guaranteed issue life insurance. It offers the convenience of having no medical exam, including a physical, blood draw, and possibly other procedures. It has slightly higher premiums, usually has a maximum coverage amount, and other limitations like a 1 or 2-year waiting period.
Types of non-medical exam life insurance
Employer coverage
As part of benefits packages, employers typically offer a small life insurance coverage option. Some employers cover you regardless of if you pay anything or not, but they also give you the option to purchase more. Employers own the policy yet you can pick a beneficiary usually. Since it covers many people they are able to offer new employees protection quickly after hire and without a medical exam.
This isn’t the typical kind of life insurance that most people think of when they talk about no exam life insurance, however. While it’s a nice bonus amount of life insurance it usually doesn’t add a lot to one’s protection amount nor do you get to keep the policy if you get employed elsewhere.
Simplified issue
Simplified issue life insurance is usually taken as a term policy with industry max coverage limits of $500,000 however the max varies considerably with each carrier. In addition to the coverage maximum, there are age limit maxes that also vary but are somewhere around 80 years old.
Guaranteed acceptance life insurance
Guaranteed acceptance is usually referred to and used as final expense life insurance. It’s also whole life insurance whit limits of about $50,000 or less. Final expense insurance is used primarily for end-of-life expenses like burial expenses.
What are the typical costs of no-exam life insurance?
While it is much quicker, simpler, and easier to obtain guaranteed issue life insurance or no exam life insurance, it does cost more compared to someone that has an exam done. It can be upwards of twice as costly per month compared to standard life insurance. The exam and underwriting process are done to assess the level of risk a carrier is taking on and since they aren’t going to be doing as much with these policies it increases their cost.
Since there is more risk that gets passed onto the applicant these types of policies are usually used for specific types of protection, most notably mortgage protection and final expense insurance.
No medical life insurance is a really good option for those with pre-existing health conditions or conditions that make premiums really high for a standard policy. The normal way of thinking about life insurance is to get a large policy for as little premium as possible. However, as we get older term policies become super expensive. Due to this fact it can be more helpful to consider getting a policy that will help your loved ones cover their monthly expenses for 3-12 months.
What this does is buy them time to go through the mourning process and pay their bills for several months without worrying. Afterward, they can figure things out with the home and other things that need to be taken care of. Most people that I’ve helped get this kind of coverage to say they wouldn’t stay in their home so time to put it up for sale, move, etc.
If you want to look at the options available to you personally send us a message today. There really is no general guideline for premium cost so let us help you get a quote from several insurers to get a good idea for your situation.