What everyone should know about no-exam life insurance policies

The need to take a medical exam can understandably encourage people to push “buy 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.

There are several options available for buying life insurance online. Some include a feature that may allow certain applicants to skip the medical exam, instead relying on a detailed set of health-related questions in the application. Others don’t require an exam for any applicant, but still ask some simple health questions in the application. Still others don’t require an exam or ask health questions.

As you can imagine, because of this difference, prices vary considerably, depending upon the type of policy you buy. As a shopper, you need to do a bit of research to ensure you’re getting the best value possible.

If you are keen to skip the medical exam, it’s important to understand how different types of policies deal with the medical exam. To pick the best life insurance policy for you, consider how much you want to spend, how much coverage you need and what your current health is.

To help you pick the right type of policy for your needs, let’s first start with a few product definitions.

Medically underwritten life insurance

Policies that are medically underwritten are often the most affordable types of life insurance. Such policies take into consideration your age, lifestyle choices (like smoking or scuba diving), current health and personal and family health history to personalize pricing to you and only you in the underwriting process. (Hence the term medical underwriting.) There are plenty of medically underwritten options in both term and permanent life insurance policies. This type of policy is usually available in many coverage amounts generally ranging from $100,000 to several million dollars. Medically underwritten policies are subject to underwriting approval, and issuing the policy or paying its benefits depends on the applicant’s insurability, based on their answers to the health questions in the application, and their truthfulness.  Some medically underwritten policies include an internal process that may allow some applicants to qualify to skip the medical exam. Those who don’t will need to take a medical exam.

Types of life insurance policies with no medical exam

Simplified issue life insurance

Simplified issue life insurance is one of the most common types of no-exam life insurance policies. These policies typically require applicants to fill out a short questionnaire in the underwriting process, with a few health-related questions. But no exam is needed to secure coverage. Sometimes, you may need to complete a brief phone screening. Since an insurer knows less about you, the applicant, without fill insight into your lifestyle and health history, you are generally going to pay more for coverage than with a medically underwritten life insurance policy. Additionally, maximum coverage amounts and term lengths are limited to around 20 years and $250,000. Occasionally, you can find policies up to $500,000.

Guaranteed issue life insurance

Guaranteed issue works as the name implies. All applicants are guaranteed approval on coverage, regardless of age or health. But that comes with some caveats. This no medical exam life insurance is usually limited to a death benefit of $50,000 or less and is a type of permanent coverage, which means that as long as you pay your premiums, coverage lasts for the rest of your life. Additionally, you would pay much more than you would when compared to a medically underwritten or simplified issue policy. Typically, this no medical exam life insurance is viewed as a “final expense” policy.

Choosing the right policy for you

If you want: Affordable life insurance coverage and are flexible about taking a medical exam

If you are price sensitive, then you may want to consider medically underwritten term life insurance, which will most likely be your most affordable option.

Historically, most medically underwritten policies require a medical exam. But there has been some underwriting innovation in the life insurance industry that permits certain applicants who qualify for it to forego the medical exam. For example, at Haven Life, we offer an InstantTerm process where some applicants, ages 18-59, seeking a $1 million death benefit or less may be able to finalize coverage without a medical exam, based on the information provided during the application process. Customers are notified once an app is submitted if they qualify to skip the exam. [A note from our lawyers: 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.]

Medically underwritten coverage without a medical exam is a bit of a roll of the dice… because you may not qualify for the no-exam decision process. But, if you do, this type of policy often provides you with a wide range of coverage options, better pricing, and, exam or not, a pretty simple application and purchasing experience.

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If you want: A no-exam policy and are OK paying a bit more for it

If you absolutely do not want to take a medical exam and are OK paying more for the coverage, then consider a simplified issue policy. You’ll generally be limited to a face amount of $250,000 or less, so make sure that’s enough coverage for your family’s needs. (After all, life insurance isn’t about the medical exam, it’s about the people you are financially protecting.)

You’ll have to pay higher premiums to compensate the insurer for taking on more risk by not fully knowing your medical history. To give you an example of price differences, a 20-year, $250,000 simplified issue policy might cost a healthy 30-year-old man $43.61 per month (Policygenius, Mutual of Omaha). For $28 per month, that same man could be getting more than triple the coverage: a 20-year, $750,000 medically underwritten Haven Term life insurance policy issued by MassMutual.

If you want: Coverage that won’t be impacted by health conditions

If you are sick or have been definitively turned down for other types of coverage, simplified issue or guaranteed issue life insurance policies will be your best options. Consider applying for a simplified issue policy first as premiums are more affordable and it has more coverage options.

If you don’t qualify for a simplified issue policy, then guaranteed issue coverage can be a valuable financial solution to help your family with funeral or other expenses if you were to pass away.

While it’s, yes, time-consuming to apply for multiple life insurance options, keep in mind that the end goal is peace of mind for you and financial protection for your loved ones.

If I need to take a medical exam, what happens?

Taking a life insurance medical exam is simpler than it sounds.

The medical exam provides the life insurance company with an opportunity to verify everything you’ve filled out in the application and personalize the rate to you and your health. And if you’re healthy, this is a good thing for you (and your wallet). You get the chance to wow the insurer with how little risk you represent, and, ultimately, secure a lower insurance rate.

Once you complete your life insurance application, you set up your exam at a time that is convenient and comfortable for you. You can choose whether you want a paramedic to visit your home or workplace, or you’d rather drop by a medical testing office.

For the exam, you’ll answer some questions about your medical history and family medical history. Then, you’ll get a mini-physical requiring blood and urine samples. This can include tests for things like cholesterol, body mass index (BMI), blood sugar, blood pressure, and indications of nicotine, tobacco, or drug use. It typically takes less than 30 minutes.

And if 30 minutes can save you on your insurance premiums, it just might be well worth your time.

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Haven Term is a Term Life Insurance Policy (ICC17DTC) issued by Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA 01111 and offered exclusively through Haven Life Insurance Agency, LLC. Policy and rider form numbers and features may vary by state and may not be available in all states. In New York, Haven Term is DTC-NY 1017. Our Agency license number in California is OK71922 and in Arkansas, 100139527.

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