Is No Exam Life Insurance for You?

For a variety of reasons, people sometimes want life insurance but don’t want to go through a health exam. It’s a fairly no-muss, no-fuss way of getting a policy. But is it the right thing to do? The answer: it depends.

Why Would You Want No Exam Life Insurance?

Typically, people who purchase a no life insurance policy do so for one these reasons:

1. They are older and/or have health problems and are concerned about the affect that might have on the cost and availability of a policy
2. They just don’t want to deal with the time consuming process of an exam
3. They want coverage fast, and traditional policy approvals take longer
4. Their employer provides life insurance, they want to supplement it, but additional coverage is not available through work

The Downside to No Exam Life Insurance

While no medical exam insurance does not require a physical exam, it does have some negatives to consider.

• Payout amounts are smaller than with an exam-required policy
• Premiums are more expensive for healthy people than with a policy that requires a medical exam
• Some types of policies do not guarantee approval
• Some types still require an applicant with health issues to have a medical exam
• Some have age limits
• Processing takes longer

Types of No Exam Policies

There are a number of options for no exam life insurance to choose from.

1. Simplified Issue

While they don’t require a medical exam, simplified issue policies ask about health history on the application. They also might need other background and glean information about prescription drugs, DMV records and past life insurance applications. Approval isn’t guaranteed.

2. Guaranteed Issue

Guaranteed acceptance policies are usually whole life insurance with smaller benefits. Older people often use these kinds of policies to cover final expenses such as funeral costs. Middle aged people and seniors purchase these policies when their health would disqualify them from other life insurance. Full benefits are graded in payouts and usually won’t pay the full death benefit for the first few years of the policy.

3. Accelerated Underwriting

Some term insurance policies use accelerated underwriting, a streamlined approach. Approval can be instant for qualified applicants. Health questions are asked and data is gathered. If your health isn’t perfect you may have to have a medical exam and approval is not guaranteed.

4. Group Insurance

Group life insurance is provided through your employer, who pays some or all of the premium. Coverage is typically small. For young and healthy people, getting additional coverage through the employer’s broker may cost more than what they can purchase from an outside source.

Cost and coverage amounts for no exam life insurance vary and not all companies provide it. If you’re interested, ask your provider if they offer life insurance policies that don’t require a medical exam.