When applying for term life insurance coverage, many policies will require that an applicant undergo a medical examination prior to being approved. This is because the insurance company wants to ensure that it isn’t taking a costly risk on an individual who may be cause for a claim soon after taking on their coverage.
Due to adverse health conditions, however, not everyone who applies for life insurance will be able to qualify for a policy by going the traditional route. For this reason, there are no medical exam life insurance plans. As their name implies, these types of policies can allow applicants to obtain the coverage that they need without having to submit to a medical exam.
Yet, although a no medical exam policy makes it easier for a higher risk applicant to qualify for life insurance, there are some things to consider prior to moving forward with the purchase of this type of coverage. Looking for purchasing life insurance for your parents? You’re in luck because we can help! We also can direct you to companies who offer AICPA life insurance.
We know that shopping for insurance coverage can be difficult, but that’s why we are here to help. It’s our mission to ensure that you have all of the information that you need to make the best life insurance decision for you and your family.
Considerations Before Buying a No Medical Exam Life Insurance Policy
Being approved for life insurance coverage without the need to submit to a blood and urine sample may sound like a great deal for many – especially for those who have an adverse health condition. But it is important to have a good understanding of exactly what you’re purchasing before signing on the dotted line. Therefore, here are some key factors to consider:
1) The Type of Coverage You Are Purchasing
One of the most important considerations when purchasing a no medical exam life insurance policy is knowing what type of coverage you are actually buying. This is because there is more than one version of no medical exam life insurance in the market place.
For example, if you go with a simplified issue plan, you will generally be asked only a few simple health questions so as to determine your insurability. Your answers to these questions will also help the insurance underwriters in coming up with an appropriate premium for your coverage. The questions that are typically included on the application for a simplified issue life insurance policy may be as follows:
- Are you a smoker?
- Have you been diagnosed with HIV / AIDS related complex?
- Are you currently residing in a long-term care or a skilled nursing home facility?
A simplified issue life insurance policy will typically be approved and issued within just a few days, as versus several weeks or months as is the case with a traditional life insurance policy that must go through the full underwriting process.
Another version of no medical exam life insurance is guaranteed issue. With a guaranteed issue policy, not only is there no medical examination, but there are also no health questions to contend with on the application for coverage. So, as long as the premium is paid by the applicant, he or she is guaranteed to be approved for the life insurance policy.
2) How are the Benefits Paid?
Another key consideration when purchasing no medical exam life insurance is how the benefit proceeds will be paid out to the policy’s beneficiary. This is important because certainly a primary reason for purchasing life insurance is to provide funds to loved ones for final expenses, debt payoff, or other financial considerations.
While some no medical exam life insurance policies will pay out the full amount of the death benefit to the beneficiary right away, others will require that the policy be in force for a certain amount of time – such as two or three years – before the full amount is eligible to be paid out. These are referred to as graded benefits. In these instances, the policy’s beneficiary may only receive a refund of the premiums that were paid, along with possibly a small amount of interest, if the insured were to die within the first couple of years that the policy is in force.
3) The Amount of Coverage
The amount of death benefit coverage is another primary factor to consider when purchasing a no medical examination life insurance policy. This, of course, is a key consideration when purchasing any type of life insurance, as you want to ensure that survivors will have enough proceeds to pay off debt, replace income, or take care of the financial task that the coverage was intended to perform.
In some cases, no medical exam coverage may have a limited benefit amount that ranges from $10,000 to $25,000. However, in other cases, the amount of coverage may go as high as $500,000 or more. Therefore, it is important to find the policy that will offer the amount of coverage that will best fit with your specific needs.
Before you purchase life insurance through a no exam plan, it’s important that you calculate how much insurance coverage that your family will need if something tragic were to happen to you. Before you buy no exam coverage, add up all of your debts and any other major expenses that your family would be left with. In most cases, a no exam plan will not give your family the money that they need. The primary goal of your life insurance is to ensure that your family can pay off those bills without draining their savings account.
Another factor to consider is your annual income. The secondary goal of your life insurance is to give your family the money that they need to replace your paycheck if you were to pass away. If you are the main source of income, then your family would struggle if you passed away.
4) Length of Coverage
The length of coverage is also an important element to consider. This is because you do not want the life insurance policy to expire before the need for the insurance is up. In doing so, choosing your no medical exam term insurance option should be done with caution.
When purchasing life insurance, there are two primary types that can be chosen. These are term and permanent. With permanent life insurance, there is no expiration on the coverage, provided that the premiums are paid. These types of policies will therefore last throughout the remainder of the insured’s lifetime.
Permanent life insurance provides the insured with both a death benefit option, along with a cash value component. Because of this, permanent life insurance can be more costly than purchasing a comparable amount of term life insurance.
Term life insurance is considered to be the most basic type of life insurance that is available in the market place today. This is because term offers just a pure death benefit option, without any type of cash value build up. Because of this, term life insurance can provide a fairly inexpensive option for obtaining death benefit coverage.
With term life insurance, an insured can typically choose from a number of different time frames, or “terms,” of coverage. These are typically 10 years, 15 years, 20 years, and 30 years – depending on the coverage needs of the insured. Once the time frame has elapsed, however, the term life insurance policy will expire and the insured will need to obtain new coverage at his or her then-current age.
With that in mind, it is important to be mindful of how long you may need life insurance coverage when you are purchasing term life insurance. For example, if you are buying coverage so that you can pay off the balance of your mortgage, and you have 15 years left to pay on the balance, then a 15 year term life insurance policy may be a good option. Or, maybe you have a newborn and you want to provide that dependent child with life insurance protection until they are self-sufficient, then a 20 year term life insurance plan should be a great option.
5) Premium Amount
The premium amount that is charged is another key factor to consider when you are purchasing no medical exam life insurance. This is especially important because the premiums on no medical exam coverage can be quite high.
Because the applicants on no medical exam life insurance policies are typically those who are considered to be of higher risk, life insurance companies have to compensate for the additional amount of risk that they are taking on. They do so by charging more in premium. In many cases, the premium that is charged can be two to three times higher on a no medical exam plan than it is on a comparable traditionally underwritten life insurance policy.
6) Insurance Company Rating
When seeking a no medical exam life insurance policy, it is also important to consider the rating of the underlying life insurance company. Even if a policy that you are looking at has an attractive premium and benefits, it is a good idea to first review the insurer’s rating prior to moving forward.
Life insurance companies are provided with ratings from rating agencies such as A.M. Best, Standard & Poor’s, Moody’s, Fitch, and TheStreet.com. Typically, these ratings are provided in the form of a letter grade, from A++ to F, similar to a school report card. These ratings signify an insurer’s financial strength and claims paying ability. Certainly, the higher the rating, the stronger it is felt that the insurer is in terms of its financial ability, and for paying out its policy holder claims. Oftentimes, it is recommended to stick with insurance companies that have ratings of A or better.
7) Other Available Options
The other options that you have available to you is another big factor to consider when you are thinking about purchasing a no medical exam life insurance policy. In some cases, a no medical exam policy may be the only option possible due to age or an adverse health condition.
However, in some cases, it may be possible to qualify for a traditionally underwritten life insurance policy – even if you have been turned down for coverage in the past. This is because all life insurance companies do not underwrite their applicants for coverage in an identical manner. This means that an applicant could be turned down for coverage by one insurer, but approved by another – even with the very same health, age, and other qualifying factors.
With this in mind, it definitely pays to know what options are available to you when shopping for life insurance coverage – and one of the best ways of doing that in a timely and efficient manner is to work with a company or an agency that has access to more than just one life insurance carrier.
Why? For one reason, having your application presented to numerous insurance companies won’t lock you into the underwriting standards of just one carrier. This alone can help to improve your chances of policy qualification substantially. It can also allow you to compare different companies’ plans, benefits, and premium quotes – and in turn, to determine which one will work the best for your specific situation, goals, and cost budget.
How and Where to Purchase No Medical Exam Term Life Insurance
When buying no medical exam term life insurance, it is important to have a good understanding of exactly what it is that you are purchasing. Just like with other types of life insurance, there are numerous variations that no medical exam coverage can take on. Therefore, it is wise to know what you have available to you in terms of benefit amount, length of term life coverage, the premium that will be charged, and the way that the insurance proceeds will be paid out to the policy beneficiary.
When you’re ready to shop for a no medical exam life insurance policy – or if you wish to compare your life insurance policy coverage options – we can help. We work with many of the top life insurance carriers in the industry – and we can get you all of the important information that you need in order to make a well informed purchase decision on what will be best for your needs.
We can help you in determining many of the essential questions, such as:
- How much life insurance coverage is enough?
- What type of insurance is right?
- Which carrier will be the best one for your specific requirements?
You can obtain all of the pertinent details that you need directly from your home computer quickly, easily, and conveniently – and without the need to meet in person with a life insurance agent. If you’re ready to get started, just simply fill out the life insurance quote form to the right of your screen and an experienced agent will be in contact with you shortly.
Should you have any additional questions along the way regarding the things you should consider before buying no medical exam term life insurance – or even about life insurance in general – then please feel free to contact us directly. We can be reached via phone, toll-free, by calling 334-380-4188.
We understand that the purchase of life insurance can at times seem confusing. There are a lot of details to consider. That’s why we want to ensure that you have all of the information that you require before you move forward with your policy. So contact us today – and see how we can help.