One of the main selling features, insurance companies and agents will use when describing a burial life insurance policy is the fact that oftentimes, individuals will be able to qualify for coverage immediately. Or in other words, they will be able to purchase their burial life insurance policy with no waiting period.
And while this is technically true that most burial life insurance policies can be purchased immediately without having to wait for a lengthy underwriting process, the term “no waiting period” can often be confused with the idea that one is immediately insured for all causes of death immediately upon approval regardless of what TYPE of burial life insurance policy they have applied for.
This is why in this article, we’re going to clear up many of the misconceptions people may have about how burial life insurance policies work. How coverage can begin immediately, and how certain guaranteed issue burial life insurance policies will contain a waiting period before they will offer full and complete coverage to the policyholder (or insured).
What is a burial life insurance policy?
A burial life insurance policy, also known as final expense insurance, is a type of life insurance that is specifically designed to cover end-of-life expenses such as funeral costs. It is typically a whole life insurance policy, meaning that it has a fixed premium and provides coverage for the entirety of the policyholder’s life as long as premiums are paid.
The death benefit from these policies can be used to cover expenses such as funeral costs, medical bills, outstanding debts, or even final expenses that may not be covered by other forms of insurance.
Burial life insurance policies typically have smaller death benefit amounts compared to traditional life insurance policies and are often marketed to seniors or individuals with limited financial means.
Two types of No-Waiting Burial Insurance Policies
There are two main types of burial life insurance policies: Simplified Issue Life Insurance Policies and Guaranteed Issue Life Insurance Policies.
Simplified Issue Life Insurance Policies are designed for individuals who are in standard or above health and are looking to either avoid taking a medical exam or are looking to obtain full coverage as soon as possible. Some of the features of a simplified issue life insurance policy include:
They typically have a shorter application process that only requires basic health questions and can be approved quickly. The coverage starts immediately after the application is approved, and there is no waiting period.
- No medical exam required
- Approval based on answers to health questions on the application
- Smaller coverage amounts compared to traditional policies
- Higher premiums than traditional policies
- Coverage can be purchased at a wider range than most guaranteed issue life insurance polices.
- The policy can be purchased as a term or a whole life insurance policy.
- Individuals seeking final expense coverage will typically choose to purchase a simplified whole life insurance policy.
With respect to simplified issue life insurance policies, it is OK to refer to them as a “no waiting” option because eligible applicants will usually be approved IMMEDIATELY, and full coverage will begin immediately upon approval pending your first premium payment.
Guaranteed issue life insurance policies are life insurance policies that do not require a medical examination or any health-related questions to be answered. These policies are typically more expensive than traditional and simplified issue life insurance policies and may have lower coverage limits.
That said, guaranteed issue life insurance policies are frequently the only option for people with serious health problems or those who have been denied coverage elsewhere.
Guaranteed issue life insurance policies will also have stricter age requirements for applying and will contain a graded death benefit or WAITING PERIOD before the policy will offer complete coverage for natural causes of death.
Guaranteed issue life insurance policies will allow one to be approved coverage with NO WAITING PERIOD, that coverage will not be fully in effect for at least 2 and sometimes 3 years.
For this reason, we here at IBUSA, do not like to refer to Guaranteed Issue Life Insurance Policies as no waiting burial insurance policy.
(Moving forward we will now only refer to a Simplified Issue Life Insuance Policy as a No Waiting burial life insurance policy).
How to obtain a Simplified Issue Burial Insurance Policy with No Waiting Period
A Simplified Issue Burial Insurance Policy is a type of life insurance policy that requires a limited amount of underwriting, typically just a few medical questions and no medical examination. These policies are designed to provide coverage specifically for end-of-life expenses, such as funeral and burial costs.
To obtain a Simplified Issue Burial Insurance Policy with no waiting period, you will typically need to:
- Find a company that offers this type of coverage. Not all insurance companies offer Simplified Issue Burial Insurance Policies, so you may need to shop around to find one that does.
- Meet the eligibility requirements. While you will not be expected to complete a medical exam, simplified issue life insurance policies will require you to answer a series of medical questions which will vary depending on the insurance carrier you select. Additionally, most simplified issue life insurance companies will look at additional data before approving your application which may include a: prescription data base check, a criminal background check, a DMV report, a credit worthiness report in addition to a variety of internal reports insurance companies have access to (Medical Information Bureau MIB)
- Choose the coverage amount and the premium payment option.
- Submit the application and pay the first premium once you have been approved for coverage.
Can My Application be Denied?
Unlike a guaranteed issue life insurance policy which will only require an applicant to meet a minimum age requirement and be a US citizen living in a state where these types of life insurance policies are offered, applicants applying for a simplified issue life insurance policy can be denied coverage.
In fact, they can be denied for a whole host of reasons that might not cause them to be denied a fully underwritten or traditional life insurance policy. Factors that may lead to denial of coverage include but not limited to:
- Pre-existing health conditions that are considered high-risk by the insurance company
- Unacceptable answers to health questions on the application
- Incomplete or inaccurate information on the application
- Failure to pass a medical exam if required
- A history of criminal activity or fraud
- Non-payment of premiums
This is why, it’s always prudent to first speak with an insurance professional that has access to dozens of different types of insurance products so that they might be able to prevent you from being denied coverage if it doesn’t look like you wouldn’t automatically be approved.
Fortunately here IBUSA, we offer a wide variety of different life insurance products from dozens of different insurance companies so if you are looking for a “no wait” burial life insurance policy we should be able to provide you with several different options to choose from.
Frequently Asked Questions
What is a no waiting period life insurance policy?
A no-waiting period life insurance policy is a type of policy that provides coverage immediately upon approval, without a waiting period. This differs from traditional policies which may have a waiting period before the coverage starts.
This should not be confused with a guaranteed issue life insurance policy which will approve applicants immediately but not offer full coverage for a minimum of 2 years.
What are the benefits of a no-waiting period life insurance policy?
The benefits of a no-waiting period life insurance policy include immediate coverage, peace of mind, flexibility, avoiding the financial burden, and in some cases no medical exam required.
What types of life insurance policies have no waiting period?
Simplified issue life insurance policies and guaranteed issue life insurance policies are types of policies that have no waiting period. Guaranteed issue life insurance policies however will contain a graded death benefit which will limit when the policy will begin to cover natural causes of death.
Are no waiting period life insurance policies more expensive than traditional policies?
The premiums for no waiting period life insurance policies are higher than traditional policies.
Are there any restrictions on who can get a no-waiting period life insurance policy?
Simplified issue life insurance policies typically require a short application with basic health questions, while guaranteed-issue life insurance policies are available to individuals regardless of their health status. However, the coverage amounts will be typically lower and the premiums will be higher than traditional policies.
Can I use the death benefit from a no-waiting period life insurance policy for any expenses?
The death benefit from a no-waiting period life insurance policy can be used to cover end-of-life expenses such as funeral costs, medical bills, outstanding debts, or even final expenses that may not be covered by other forms of insurance.
Is there an age limit for obtaining a no-waiting period life insurance policy?
The age limit for obtaining a no-waiting period life insurance policy may vary depending on the provider or the type of policy you choose.
Can I purchase a no-waiting period life insurance policy if I have pre-existing health conditions?
Yes, you can still purchase a no-waiting period life insurance policy even if you have pre-existing health conditions. Simplified issue life insurance policies will require that applicants meet a minimum health requirement which will vary between carriers. In general, though, they will typically require an applicant to be at a Standard or above rate to qualify for coverage.
Applicants with more serious pre-existing medical conditions should be able to qualify for a guaranteed issue life insurance policy provided they meet the minimum age requirements and are a US citizen living in a state where these policies are offered.