Pros and Cons of No Medical Exam Life Insurance
Have you been putting off purchasing life insurance because of your hectic schedule?
Are you constantly traveling for work? Or maybe, you just can't stand the thought of giving blood.
The good news is, you are not alone, and we can probably help.
Over the last five years, a handful of highly-rated insurance companies have started offering traditional term life insurance that doesn't require an exam for approval.
No medical exam life insurance is available to most applicants under the age of 60, but its not ideal for everyone. We've explained the pros and cons of no medical exam life insurance to help you decide if its the best option for you.
Here’s what we'll cover in this post:
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Here’s what we'll cover in this post:
The Pros of No Medical Exam Life Insurance
The hustle and bustle of today’s society can be overwhelming - we are constantly connected to our phones, regularly checking emails, and when unexpected meetings pop up out of nowhere, it’s hard to set aside an hour or two to have a nurse draw your blood and check your vitals.
Undoubtedly, this is what makes no exam life insurance so great - you don't have to complete a medical exam for approval. Instead, the life insurance company you apply with with electronically review your MIB records and prescription history to determine your eligibility for coverage.
Here are some of the additional benefits of no exam life insurance:
- No Medical Exam - No need to set time aside to travel and meet with a nurse or a doctor.
- No Needles - A lot of people can't stand the thought of giving blood or getting poked by needles.
- Fast Approval Time - Most non-med policies are approved in as little as 24 hours to 2 weeks.
- Convenience - Purchasing a no exam life insurance policy involves only a phone call.
People We’ve Helped
We've helped thousands of people with their life insurance needs, and over the years we've found that no medical exam life insurance is a better fit for some potential clients than others. These clients typically include:
1. People who have extremely busy schedules - if you're always on the go, or don’t have time for a nurse to come by your home or office.
- Truck Drivers
- Traveling Salespeople
2. Those who need life insurance in a hurry- no exam life insurance is usually approved in a fraction of the time it takes to approve a policy that requires a medical exam.
- Divorce Decrees
- SBA Loan Collateralization
- Business Loans
3. Applicants who hate needles - or can't stand the thought or giving blood. Who really wants to get poked anyways?
- Someone with White Coat Syndrome
- Hemophobiatics (People who can't stand the site of blood)
- Applicants that Hate Needles
While no medical exam life insurance may be a great fit for some people, here are few examples where you may be better off taking an exam.
Cons of No Medical Exam Life Insurance
No medical exam insurance has age restrictions so it may not be available to some older applicants. For applicants over the age of 60, we usually recommend completing an exam, but we do offer limited options for no exam term life insurance until the age of 70.
If you need more than $500,000 of life insurance, you may be better off completing an exam as well. While we can offer you up to $2,000,000 of coverage without an exam, when purchasing more than $500,000 of coverage, we always recommend comparing rates to evaluate the potential savings.
Purchasing life insurance without an exam is extremely convenient, but this creates a bigger risk for the insurance company, so it also carries a higher cost. If you're young an healthy, you might not notice a difference, but after the age of 50, no exam insurance tends to be about 10-20% more.
Types of No Medical Exam Life Insurance
Almost every type of life insurance is available without a medical exam. In addition to the guaranteed issue insurance policies you see on TV, the most popular forms of no exam life insurance include:
1. Term Life Insurance
If you’re between the ages of 21 and 70, you can purchase a no exam term policy with up to $2,000,000 in death coverage. These policies are just like traditional term life insurance policies and they offer fixed rates for 10, 15, or 20 years.
2. Guaranteed Universal Life Insurance (GUL)
Guaranteed Universal life insurance policies, also known as GULs, offer a level death benefit and fixed rates until age 90 or later. GULs are available to qualifying applicants between the ages of 21 and 65 and offer up similar guarantees to term insurance.
Guaranteed universal life is an excellent alternative to non-guaranteed universal life insurance because the policies carry very little risk and do not require additional an investment to build a cash value so they're less expensive. With most companies, GUL coverage is limited to $500,000 without completing an exam.
3. Whole Life Insurance
Whole life coverage tends to be a bit expensive, but if your health is average or better, these policies are the most convenient to buy. They require very little underwriting and are usually approved in less than a week.
Most whole life insurance companies usually overlook minor health issues and preventative including medications for issues like blood pressure, cholesterol, or both. In fact, we have also received approvals for well-controlled type II diabetics and applicants who are extremely overweight.
These policies offer a death benefit of $50,000 or less and expire at age 100. If you need more than $50,000 of coverage, we recommend purchasing a GUL policy instead. For healthy applicants, GUL insurance is about half of the cost of a comparable whole life policy.
5. Guaranteed Issue Life Insurance (GI)
Guaranteed issue policies offer up to $25,000 in death benefits for those who are between ages 50 and 85 and have serious health issues.
These policies are the ones that you normally see advertised on TV by celebrities or AARP and they tend to be expensive for the amount of coverage you receive because “no health questions are asked.”
6. Graded Benefit Whole Life Insurance
Similar to guaranteed issue insurance, these policies are for applicants serious health issues such as type I diabetes, cancer, or heart disease. Graded benefit policies offer up to $25,000 in death benefits, but there is a two year waiting period before the policy offers a full death benefit.
These polices tend to be extremely expensive however, because, they offer limited protection from day one, almost everyone is accepted, and the premiums are guaranteed for life. Read more about the pros and cons of whole life insurance here.
Common Misconceptions About No Exam Life Insurance
Some of the clients we speak with mistakenly believe that "no medical exam life insurance" means no medical questions asked, no health records, and no prescription checks. Unfortunately, the company you apply with will want to ask you some questions, they will not just mail you a policy.
Aside from guaranteed issue life insurance policies (GI’s), or policies with a waiting period, almost every life insurance company will review your MIB (Medical Information Bureau) files before issuing a policy to you. In addition, the insurance company will also review your prescription history and motor vehicle records.
We always recommend being honest with your agent about any health issues because the insurance companies are very diligent with underwriting and failing to disclose health conditions or ongoing treatments will delay your approval or even cause your application to get declined.
If you have a few health issues, please be upfront with your agent. We work with more than 50 top-rated companies to match our clients with the best insurer for their unique health profile.
When Does My Coverage Begin? How Long Until I am Fully Covered?
If you're purchasing no medical exam term, guaranteed universal life, or traditional whole life insurance, you're fully covered as soon as you make your first payment. With guaranteed issue and graded benefit life insurance policies, however, there is a two-year waiting period before your beneficiary would receive the policy's full death benefit.
If you're purchasing whole life insurance through the mail, your bank, or on TV, you also want to be weary of increasing premiums. Some whole life policies will raise your premiums as you age, (usually every five years), and some of these policies even expire when you turn 80. If you are considering whole life insurance, be sure to clarify the details with your agent when you apply.
It is also important to be aware of what type of coverage you’re actually purchasing. We find that there are some agents in the industry that offer their clients an accidental death life insurance policy rather than a policy without a medical exam. These accidental death policies provide very little protection because they will only pay a death benefit if the insured dies in an accident.
These policies DO NOT provide a death benefit if the insured passes away from anything health-related such ascancer, heart disease, stroke, etc. In addition, the odds of dying in an accident are extremely low, so make sure you ask your agent if the policy you're considering offers full-coverage from day one, despite the cause of death.
All of the traditional whole life, term, and GUL insurance policies we sell provide immediate full coverage without a waiting period. If you cannot qualify for immediate coverage due to a severe health issue, we'll help you compare rates from our guaranteed acceptance carriers to help you find your best option.
How Do I Apply For No Medical Exam Life Insurance?
Purchasing no medical exam life insurance is as simple as contacting a licensed agent and answering some health and lifestyle questions. Based on your answers, your agent will be able to match you with the company that will be the most lenient with your health profile.
If you have serious health issues that would prevent your application from getting approved, your licensed agent will advise you of your options and likely recommend applying for a guaranteed issue (GI) policy with no health questions asked instead.
Every life insurance provider has its own approval process and some are much faster than others. Some no medical exam polices take up to four weeks for approval, which is faster than taking an exam, but if you're up against a deadline, let your agent know...A handful of the companies we represent can approve your application in as little as 15 minutes.
Once your application is approved the first payment will be deducted from your bank account to start your coverage, and a copy of your policy will be mailed to your address within five to seven days.
We Can Help You Compare Your Options
If you need life insurance in a hurry, still have questions about no exam life insurance, or if you would like to compare the cost of a no medical exam life insurance policy to a policy that requires an exam for approval, we can help!
We work with over 63 top-rated life insurance companies and our agents are experts at finding our clients the best life insurance coverage available.
In just a few minutes we can compare rates from dozens of leading insurers to save you time and money. Give us a call today! Our shopping services are free, and there is no cost to apply for coverage. Toll-free: 855-247-9555.
Managing Partner and Co-founder
Cliff is a licensed life insurance agent and one of the owners of JRC Insurance Group. He has helped thousands of families of businesses with their life insurance needs since 2012 and specializes with applicants who are less than perfect health. In his spare time he enjoys spending time with family, traveling, and the great outdoors.