When you’re looking for affordable life insurance, typically the policies that are fully-underwritten are cheaper than no medical exam life insurance. The problem with getting the rock-bottom rates is that these policies can take weeks or even months to get issued and, quite frankly, a lot of people do not relish the idea of a stranger giving them a medical exam. Even if you can buy life insurance cheaper when it’s fully-underwritten, there are a number of reasons to forgo the medical exam and pay a little more if necessary: You need immediate coverage You have health issues You want a guaranteed issue policy You need coverage to satisfy a contractual agreement Whatever your reason for wanting to skip the medical exam, there are three types of policies to choose from and there are many companies available to get your insurance issued without an exam. How much you’ll pay will depend on if you prefer term insurance (the most affordable) or permanent insurance (builds cash value).
What are the 3 types of No Medical Exam Life Insurance?
If you are sincerely concerned about an insurance company learning about your medical history you should understand that your insurer will generally get some medical information about you by accessing the medical information bureau (MIB) and doing a Script Check.
Companies that offer simplified issue policies can have you covered usually the first day. There is no medical exam and any reports they order are done electronically which greatly reduces the time of getting your policy issued. The following life insurance companies offer Simplified Issue life insurance policies with very competitive rates:
|Life Insurance Company||Product Name||Face Amounts|
|American Amicable||Term Made Simple||$50,000 - $400,000|
|American National||Signature Term||$50,000 - $250,000|
|Assurity Life||Term Life||$50,000 - $500,000|
|Mutual of Omaha||Term Life Answers||$25,000 – $99,999|
|Nassau RE||Safe Harbor Term||$50,000 – $500,000|
|Sagicor||Sage Term||$50,000 – $500,000|
|Transamerica||Trendsetter LB||$50,000 – $250,000|
This is a fairly new concept and is typically only beneficial to very healthy people. Typically it involves a telephone interview with an underwriter, a review of your MIB report, and a review of your Script Check report. With Accelerated Underwriting the maximum face amount is typically higher (about $1 million) and the rates are generally the same as a fully underwritten policy. If, however, you are currently a tobacco user or have used tobacco in the last 13 months, you’ll likely have to have a medical exam. Here are the companies that have established the Accelerated Underwriting process:
|Life Insurance Company||Product||Face Amounts|
|Banner Life||OPTerm||$100,000 - $1 million|
|John Hancock||Smart Protect||$100,000 - $1 million|
|Lincoln Financial Group||TermAccel||$100,000 - $500,000|
|Pacific Life||Pacific Prime||$100,000 - $259,999|
|Principal||Term||$50,000 - $1 million|
|Savings Bank Mutual Life Ins. Co of MA||Term||$100,000 - $500,000|
Guaranteed Issue or Guaranteed Acceptance
Guaranteed issue life insurance should only be considered as a last resort. With this type of policy (usually used by seniors with health issues), there is no medical exam and no health questions on the application. Virtually anyone within the eligible age group (typically 50 – 85) and not living in a hospice facility will qualify for coverage. There are downsides to consider:
- The death benefit is usually capped at $20,000 to $35,000.
- The rates are much higher than a simplified issue or accelerated underwriting because the policy is generally whole life insurance.
- There is usually a waiting period of two or three years before the insurance company will pay the full death benefit if you die from natural causes.
Life insurance companies that offer Guaranteed Issue or Guaranteed Acceptance life insurance:
|Life Insurance Company||Product Name||Maximum Coverage|
|Colonial Penn||Guaranteed Acceptance||$50,000|
|Americo||Ultra Protector III||$10,000|
|Mutual of Omaha||Whole Life Guaranteed||$50,000|
|Fidelity Life||Rapid Decision Guaranteed Issue||$20,000|
The Contestability Period will protect the Insurance Company
Insurance shoppers and applicants need to understand that the insurance company is protected in the first two years by the contestability period that each insurance contract contains. During the contestability period, the insurance company can investigate any claim that is a result of natural causes. This means that if the insurance company finds that the applicant was untruthful or intentionally omitted information on the application, the company can deny the claim for misrepresentation. This clause doesn’t mean your insurance company doesn’t trust you, rather, the clause is there to mitigate the risk that the applicant did not complete the application honestly.
The Bottom Line
No exam life insurance is not the best choice for everyone. The type of insurance you purchase should be based on your personal needs, budget, and whether or not you wish to deal with an insurance medical exam. The exams can be scheduled at your home or workplace and generally take about half an hour. If, however, you are totally against having a life insurance medical exam but know that you need life insurance, then, by all means, choose from one of the companies above after you’ve gotten your quotes.