What everyone should know about no-exam life insurance policies

I remember my life insurance medical exam. It was relatively painless, but if it would have taken longer than 30 minutes or required me to sit in a waiting room, I might not have gotten the coverage I needed. What can I say? I know myself.

The need to take a medical exam can understandably encourage people to push “buy a life insurance policy” further down their to-do list. The health exam itself is not a big deal, but it’s a hurdle that takes time out of your day. It gets personal. And frankly, no one likes needles.

These days, there are several options available for getting a life insurance quote, and buying term life insurance, entirely online. Some online life insurance companies and providers have made progress in using sophisticated underwriting algorithms to remove the need for a medical exam among certain qualified applicants. Other digital options ask minimal health questions online and adjust premiums as a result of the ambiguity in your health. And still others don’t require you to answer any health questions at all.

If you’re in the market for life insurance and want to know whether you should consider buying a no-exam policy, you need to do a bit of research to ensure you’re getting the best value for your money while also being honest with yourself about whether you’re willing to take time out of your day for a medical exam. To help you pick the right type of policy for your needs, and understand what your options are, here are a few key questions to consider when thinking about no medical exam life insurance.

What are the tradeoffs with no-exam life insurance?

So you’re considering no medical exam life insurance, but you’re probably wondering the obvious question: What’s the catch? Well, it’s how much you are willing to pay for life insurance. If you want to pay less, you should consider a fully medically underwritten policy. Medically underwritten or individually underwritten coverage is usually less expensive than an entirely no-exam life insurance policy, especially if you’re already in good health, but that means getting a traditional life insurance medical exam in many cases. These medical examinations are relatively short, only taking about 20 minutes to run through various medical questions and basic tests (including a blood draw). This is all a part of the underwriting process. The upside is that, because you’re providing the most accurate portrait of your overall health and medical history, the life insurance company can offer you the best possible rate for your life insurance policy. The other upside is that in some cases you won’t actually need a medical exam for medically underwritten coverage (more on that later).

If you’re in the market for a life insurance product and know you don’t want to take a medical exam, do a bit of research to ensure you’re getting the best value for your money—and for your health. Or, that you are comfortable with the tradeoffs.

How much life insurance can you get without an exam?

Ultimately, life insurance companies and agencies are in the risk-management business. Because of that, they will typically limit how much coverage you can get without an exam. We’re not implying you would lie on a medical questionnaire; it’s just that you might have a condition you’re not even aware of (like high blood pressure) that would affect your rates if discovered in a medical exam. Your insurer will factor in the unknowns when assigning you a rate for no-exam coverage.

The coverage limits will vary depending on the type of policy you buy. For example, at Haven Life, if you qualify, you can buy a medically underwritten Haven Term policy without a medical exam for up to $1 million. If you were to go with Haven Simple, a simplified issue (aka no medical exam) product, coverage is available up to $500,000.

What kind of life insurance does not require an exam?

There are a few types of life insurance policies that don’t always require a medical exam. Medically underwritten life insurance allows you to skip the exam in some situations. Simplified issue life insurance and guaranteed issue life insurance never require a medical exam. Let’s learn more about these types of policies:

Medically underwritten life insurance

This is typically the most affordable type of coverage. Why is that? Because whomever is issuing the insurance policy will know the most about you. Your age, your lifestyle choices, your personal and family health history — all these are factors in determining both your eligibility and the rates or premiums you will pay. In short, it’s personalized. You’ll also have the most robust set of coverage options, with a Haven Term policy that ranges from $250,000 to several million dollars.

And here’s a little bonus: Some qualified applicants might still be able to skip the exam, thanks to innovations in underwriting at places like Haven Life. Instead, you’ll submit your application and be notified instantly as to whether skipping the exam is an option for you. Again, being honest when answering questions about your health is of paramount importance. If you’re not truthful in hopes of skipping the exam, you run the risk of missing out on the policy or payment of benefits.

And here’s the corollary to what we said earlier: The more an insurer knows about you, the more affordable coverage can be. That’s certainly the case with medically underwritten term life insurance, as you can see from these examples of the cost of coverage for nonsmokers in excellent health for a Haven Term policy, issued by a subsidiary of MassMutual, C.M. Life.

Quotes for term life insurance

Estimate based on pricing for eligible Haven Term applicants in excellent health. Pricing differences will vary based on ages, health status, coverage amount and term length. These prices do not reflect the rates for applicants in DE, FL, ND, NY and SD.

Who it may be a good fit for:

If you want to pay the most affordable rates (probably), if you have no objection to taking a medical exam if it’s needed, and/ or you and your family require a policy worth $500,000 or more, you’ll want to consider medically underwritten coverage. And you never know: You might qualify to skip the exam, too. Get a quote for the Haven Term policy.

Simplified issue life insurance

True to its name, a simplified issue policy is fairly, well, simple. You fill out a short questionnaire about your health. The insurer makes a decision on your eligibility. You skip the medical exam.  And boom, if approved, you have life insurance. [Keep in mind that issuance of the policy or payment of the benefits may depend on the truthfulness of answers provided in the application.]

What’s not simple is the cost. Here’s something to keep in mind when shopping for coverage: The less an insurer knows about you, the more coverage will typically cost. Case in point: Simplified issue life insurance. Because an insurer will know less about you — and won’t have as detailed information about your health history and other relevant lifestyle decisions — you are generally going to pay more for a simplified issue policy than you would for a medically underwritten one.

One other thing: You might not get as much coverage as you would like or need. Maximum coverage amounts are often limited to $500,000 or less, and you might even be limited to term lengths of 20 years or less. With Haven Simple, you can get a policy up to $500,000. Here are some examples of the cost for nonsmokers of coverage for a Haven Simple policy, issued by MassMutual subsidiary C.M. Life.

Quotes for 100% no medical exam term life insurance

Estimate based on pricing for eligible Haven Simple applicants in excellent health. Pricing differences will vary based on ages, health status, coverage amount and term length. These prices do not reflect the rates for applicants in DE, ND, NY and SD.

Who it may be a good fit for

Maybe you’re busy (hello, new parents). Maybe you just absolutely, positively, do not want to take an exam. In that case, a 100% no-medical-exam life insurance policy like Haven Simple is a good option. And a good place to start is with a free quote.

Guaranteed issue life insurance

As you might have guessed, this type of permanent life insurance means all applicants are guaranteed coverage — regardless of age or health, no exam required. As you might also have guessed, guaranteed issue life insurance has some significant limits and caveats.

The first limit is coverage. You’re typically limited to a death benefit of $50,000 or less. If you are relatively young and have young kids in the house, that’s probably nowhere near your family’s (or dependents’) long-term needs, which might include a mortgage, education costs, end-of-life expenses and more, not to mention replacing the earnings you would’ve ordinarily brought home. Speaking of end-of-life expenses, that’s what guaranteed issue life insurance is typically used for — it’s often considered a final expense policy, covering any costs associated with you dying.

There’s another important caveat, known as a “graded death benefit.” Essentially, this type of policy will pay out only after a certain number of years (typically two or three) have transpired. This is to keep people from taking out a policy when they know they might not live much longer. And yes, this includes deaths due to natural causes. Basically, even if you die unexpectedly during those first three years, your beneficiaries may not receive a full death benefit.

Who it may be a good fit for:

Guaranteed issue life insurance is a good option if you want to cover end-of-life expenses, like funeral costs, when you pass away and for those who may not qualify for medically underwritten or simplified issue coverage. This type of permanent life insurance coverage typically sets you back more than a simplified issue or medically underwritten life insurance — and again, it often provides $50,000 or less in coverage.

Accidental death insurance

No euphemisms here, folks. You might also know accidental death insurance as accidental death and dismemberment (AD&D) insurance. In short, this policy provides a lump sum payout to your beneficiaries if you die in an accident (like a car crash or workplace injury) or in a homicide. Some (but not all) policies also cover dismemberment, paralysis, or other forms of severe injury through some type of living benefit.

What’s not covered? Death from illness, including such common causes of death as cancer, heart disease or a stroke. These limitations can leave your loved ones in a position of financial risk, so make sure you understand the details of this type of policy before you commit. Something else to consider: Many accidental death insurance policies limit their coverage, with $500,000 being a common cap.

Which reminds us: accidental death insurance is included at no charge with all Haven Simple policies. For policies of $100,000 or less, that benefit is 50% of that face amount. For policies of more than $100,000, that benefit is 25% of the face value. This is in addition to your selected Haven Simple face/coverage amount. Think of it as peace of mind ontop of peace of mind. Find out more here.

Who it may be a good fit for:

If you have been declined term life insurance due to health reasons, you might want to consider an accidental death policy.

How to choose the right policy for you

Here are four scenarios that can help you decide whether a no-exam life insurance policy is a good fit for you:

If you want: The convenience of a 100% no-exam life insurance policy

Consider: Simplified issue life insurance (Haven Simple)

Here’s why: If you under no circumstances want to take a medical exam, then consider a simplified issue policy first. You’ll generally be limited to a face amount of $500,000 or less, so make sure that’s enough coverage for your family’s needs. Use a life insurance calculator to estimate how much coverage you may need. (Remember, life insurance isn’t about the medical exam, it’s about the people you are financially protecting.)

With a simplified issue policy, you’ll have to pay higher premiums to compensate the insurer for taking on more risk by not fully knowing your medical history. But the convenience may be worth paying more.

If you want: More affordable life insurance coverage

Consider: Medically underwritten term life insurance (Haven Term)

Here’s why: If you are price-sensitive, then you may want to consider medically underwritten term life insurance. This life insurance policy will most likely be your most affordable option.

Historically, most medically underwritten policies require a medical exam. However, thanks to recent underwriting innovation in the life insurance industry, it may not be required for qualified applicants to take a medical exam. Haven Life offers the InstantTerm process in which some applicants ages 18–59 seeking a $1 million death benefit or less might meet the criteria that allows them to finalize coverage without a medical exam, based on the information they provided during the application process.

You can complete an application online to find out if you qualify to skip the exam. (Keep in mind that it’s always very important to be honest in the application process. The issuance of the policy or payment of benefits may depend upon the answers given in the application and their truthfulness.)

Whether you qualify for InstantTerm or end up taking the medical exam, medically underwritten coverage will generally provide you with a wide range of coverage options and better pricing than you’d get from a no-exam life insurance policy.

If you want: Coverage and you have significant medical conditions

Consider: Guaranteed issue life insurance and accidental death insurance, but start with a medically underwritten (Haven Term) or simplified issue (Havem Simple) policy if you haven’t applied already

Here’s why: If you want coverage, but are worried about your eligibility because of health issues, it may still be worth it to apply for a medically underwritten policy first before you consider other options.

You don’t need to be in your 20s or super healthy to qualify for affordable rates if the coverage requires a medical exam or some kind of medical underwriting. While it’s time-consuming to apply for multiple life insurance policies, keep in mind that the end goal is peace of mind (for you) and financial protection (for your loved ones). And, you want to get the most value possible.

If you have a number of health issues or pre-existing medical conditions — or if you’ve been turned down for other life insurance policies — guaranteed issue or accidental death coverage can be a valuable financial solution to help your loved ones with funeral or other expenses if you were to pass away.

Cost-conscious consumers with medical conditions also may prefer the generally lower premiums of accidental death insurance compared to term life insurance even though accidental death policies will only pay out after an accident. One advantage that accidental death insurance has over guaranteed issue life insurance is that you may find coverage up to $500,000.

If you want: More than $500,000 of life insurance coverage

Consider: Medically underwritten term life insurance (Haven Term)

Here’s why: Medically underwritten policies usually are the only type of term life insurance that will provide coverage options in excess of $500,000. And again, with a Haven Term policy, certain qualified applicants may be able to finalize up to $1 million in coverage without a medical exam. Understand your life insurance needs.

Select the policy that meets your needs and budget

Buying the right coverage and finding the best life insurance policy does not need to be complicated. Consider what price fits into your budget as well as what purchasing experience best fits with your lifestyle and expectations.

Most importantly, don’t lose sight of the fact that you’re doing all this research and buying a policy to help financially protect the most important people in your life and give you peace of mind. From term and permanent to whole and universal life insurance, there are many options to find the right one for you.