The increasing trend for more and more life insurance companies to embrace different accelerated underwriting models represents one of the few situations where the life insurance industry is modernizing itself.
As a result, many prospective buyers are now finding it possible to quickly purchase a traditional term or whole life insurance policy without taking a medical exam and/or waiting weeks for their approvals. Instead, many individuals find it possible to become fully insured within a few hours or days after submitting their application.
This may not seem all that shocking; however, given how slowly life insurance companies like to make changes, this “overhaul” of the industry is really quite impressive. We should note, however, that accelerated underwriting or no medical exam life insurance policies (as they are commonly referred to) aren’t always the best options for everyone.
This is why we wanted to take a moment and discuss some of the most common questions we receive about these new types of life insurance products.
Questions that will be discussed will include:
- What is an accelerated life insurance policy?
- Which life insurance companies offer the best-accelerated life insurance products?
- What does the application process look like when applying for an accelerated life insurance policy?
- What are some potential “knockouts” that may disqualify you from being able to qualify for an accelerated life insurance policy?
- What can you do if you’re not eligible for an accelerated life insurance policy?
- How do I know which life insurance company is best for me?
So, without further ado, let’s get started!
What is an accelerated life insurance policy?
Accelerated underwriting is a term used to describe the “process” that allows life insurance companies to decide on a life insurance application more quickly than with traditional underwriting. In accelerated underwriting, the insurance company uses advanced analytics and data sources, such as medical records and prescription databases, to decide on your application. This allows the company to bypass traditional underwriting steps, such as ordering a medical exam or obtaining a paramedical exam (i.e., collecting a blood and urine sample).
This can be especially useful if you:
- Need coverage right away.
- Don’t want to take a medical exam or provide a blood and/or urine sample.
- Are healthy and haven’t been diagnosed with any pre-existing medical conditions.
- Or are you trying to obtain a policy for someone who may find it challenging to schedule a medical exam (e.g., an ex-spouse, an interstate truck driver, or an individual living in remote areas)?
Accelerated underwriting is not available for all types of life insurance policies, and not all insurance companies offer it. Additionally, accelerated life insurance policies are not suitable for everyone, which we will address later in this article.
Which life insurance companies offer the best-accelerated life insurance products?
The following top-rated insurance companies offer what we believe to be the best-accelerated underwriting programs. We remain impartial about which company is the best, as different companies are better suited for different situations based on your particular needs and goals. Therefore, we did not rank the companies but listed them alphabetically.
Lastly, it’s worth noting that not all the companies listed below are 100% no-exam, as some may require a medical examination if you don’t meet specific criteria.
|$250K - $1 million up to age 50; $250K - $500K ages 51-60
|Accumulation Streamlined UW Program
|Up to $2 million
|Rapidecision Life & Express
|Up to $1 million
|Up to $400k
|Up to $3 million
|Up to $1 million based on age
|Up to $1 million
|Up to $2 million
|$100k up to $1 million
|Up to $1 million (Ages 51-60 up to $500k)
|Up to $1 million
|Accelerated Client Experience (ACE)
|Up to $5 million
|Up to $2.5 million
|Protective Life Underwriting Solution
|Up to $1 million (Ages 46-60 up to $500k)
|Up to $3 million
|Up to $1 million
|Up to $750K
|Up to $2 million (Ages 51-60 up to $1 million)
What does the application process look like when applying for an accelerated life insurance policy?
With accelerated underwriting, your life insurance approval can be as quick as 24 hours. Compare that with more traditional underwriting, which requires a medical exam that takes an average of 27 days.
The primary end goal of accelerated underwriting is to get a policy in the consumer’s hands quicker while increasing the consumer’s satisfaction and meeting their expectations. Source.
What is Underwriting?
When you apply for life insurance, you go through a process called underwriting.
Different underwriting programs are available, which include:
- Fully Underwritten (traditional)
- Accelerated Underwriting
- Simplified Issue
- Guaranteed Issue
Underwriting is the process in which insurance company underwriters assess your health and lifestyle details to determine whether to approve your application and what health rating to assign you.
During this process, the underwriter will carefully review your information, including your application, assign you a health rating, and ultimately determine your life insurance premium.
One advantage of accelerated underwriting is that many carriers are willing to offer the same health rate classes as with traditional underwriting. This is in contrast to many simplified issue life insurance policies, where the best health rating available is often only standard.
And with guaranteed issue life insurance, there is no underwriting involved other than ensuring the prospective applicant meets the age and residence criteria.
Underwriting has traditionally begun with a paramedical exam, where an examiner would come to your home or place of business and do a medical exam,
Traditional paramedical exams include:
- Blood work
- Urine Sample
- Blood Pressure
- Measure Height
- Record Your Weight
- Ask Additional Application Questions
- And Perhaps an Electrocardiogram (EKG)
However, for better or worse, much of your data now exists in various databases.
So, rather than sending a nurse to your home, the insurance company can conduct a comprehensive background check to determine your health and lifestyle risk level.
If you qualify for automated underwriting, the underwriter will check with some or all of the following:
- Medical Information Bureau (MIB)
- The Medical Information Bureau (MIB) is a nonprofit organization that maintains a medical and lifestyle information database on individuals who have applied for life, health, or disability insurance. Insurance companies can access this database as part of the underwriting process to determine an applicant’s risk of future medical issues.
- Prescription Database
- Motor Vehicle Records
- Credit History
What are some potential “knockouts” that may disqualify you from being able to qualify for an accelerated life insurance policy?
Before we list some red flags that would make you ineligible for accelerated underwriting, we must let you know that these rules are general and not universal.
Instead, different companies have their set criteria, some being lenient in one area or more strict in another.
About 50% of applicants ages 18-50 applying for accelerated underwriting are approved. The other 50% are required to take a life insurance medical exam.
Depending on the eligibility requirements, those aged 51 and up have a 25% chance of being approved for accelerated underwriting.
To be accepted for accelerated underwriting, you must meet the age and face amount requirements (listed in the table above).
It would be best to avoid potential red flags that could pop up along the way.
Some potential red flags that may hinder you from going the Accelerated Underwriting route would be the following:
- Your Build Is Outside Weight Limits
- You Have A Major Medical Condition
- Recent Tobacco Use
- Recent Bankruptcy
- No Felonies in the last ten years
- No more than one DUI or Reckless Driving in the previous ten years
- No Marijuana Use In the Past 5 Years
These could be potential “knockout” questions with some companies, but maybe not with others.
For example, some companies will allow certain people with diabetes to undergo accelerated underwriting, while others require you to take a paramedical exam.
The key is finding an experienced agent, like the team at IBUSA, who can align you with the right company for your specific background.
What can you do if you’re not eligible for an accelerated life insurance policy?
If you are not eligible for accelerated underwriting, then one of two scenarios will present itself.
Scenario one: you agree to take a paramedical exam and proceed with the traditional underwriting process.
Scenario two: You are not deemed an acceptable health risk; in this case, your only option may be some final expense whole life insurance product, of which there are few. With so many companies out there, it can be overwhelming.
At the end of the day, the company that will best meet your needs will be the one that caters to your unique needs and goals while also considering your specific health and lifestyle.
The good news is the team at IBUSA is here to help you locate the company that will best meet your needs. We work with dozens of the best-accelerated underwriting companies and can align you with the one that is most favorable to your unique profile.
So, what are you waiting for? Give our team a call today and experience the IBUSA difference!
Frequently Asked Questions
What is accelerated underwriting life insurance?
Accelerated underwriting life insurance is a type of life insurance policy that uses advanced technology and data analysis to determine a person’s risk level and eligibility for coverage in a faster and more streamlined way than traditional underwriting.
How does accelerated underwriting work?
Accelerated underwriting typically involves an online application and an algorithm that analyzes a person’s data and determines their risk level. Some policies may also require a medical exam or other additional information.
What are the advantages of accelerated underwriting?
The main advantage of accelerated underwriting is speed and convenience. Because the process is faster and less invasive than traditional underwriting, people can get coverage more quickly and hassle-free.
Are there any disadvantages to accelerated underwriting?
One potential disadvantage is that some policies may have higher premiums or lower coverage limits than traditional policies. Not everyone will qualify for accelerated underwriting, particularly if they have pre-existing health conditions.
Is accelerated underwriting right for everyone?
No, accelerated underwriting may not be the best option for everyone. People with more complex health issues or those who require higher coverage limits may need to opt for traditional underwriting instead. It’s important to carefully consider your options and consult with a financial advisor or insurance agent to determine the type of policy best suits your specific needs and situation.
What information is needed for accelerated underwriting?
Accelerated underwriting typically requires basic information about your health and lifestyle, such as age, height, weight, medical history, and family history. Some policies may also need information about your occupation and hobbies.
How long does it take to get approved for accelerated underwriting?
The approval process for accelerated underwriting can vary depending on the insurance company and the policy. Some policies may be approved instantly, while others may take several days or weeks.
Can I switch to accelerated underwriting if I already have a traditional life insurance policy?
It depends on the insurance company and the policy. Some companies may allow you to switch to an accelerated underwriting policy if you meet specific requirements, while others may not. It’s best to consult with your insurance agent or financial advisor to determine what options are available to you.
How do I know if accelerated underwriting is suitable for me?
Accelerated underwriting may be a good option if you want to obtain life insurance coverage quickly or prefer not to take a medical exam. However, it’s important to carefully review the terms and conditions of any policy and consider your individual needs and circumstances before making a decision. It may be helpful to consult with a financial advisor or insurance agent to determine what type of policy is best for you.