Here at IBUSA, we’ll often get asked…
“How can I get a life insurance policy without taking an exam?”
Which is why we wanted to take a moment and discuss:
- What a “no medical exam life insurance policy” is?
- How they differ from life insurance policies that will require a medical exam?
- And when these “types” of life insurance policies should be sought out and avoided in some cases.
Questions that will be addressed in this article will include:
- What is a no medical exam life insurance policy?
- What “kinds” of no medical exam life insurance policies are available?
- How do no medical exam life insurance policies or Simplified Issue Life Insurance Policies work?
- When should someone consider purchasing a no medical exam life insurance policy?
- Who should avoid these “types” of life insurance policies?
So, without further ado, let’s dive right in!
What is a no medical exam life insurance policy?
Simply stated, a “no medical exam life insurance policy” is a life insurance policy that won’t require an applicant to take a medical exam during the application process, which seems rather apparent by its name.
The only problem is…
That there are several different “types” of no medical exam life insurance policies available, and some of them may include a “waiting period” before they will provide coverage for NATURAL CAUSES of death. For this reason, we want to take a moment and discuss the different “types” of no medical exam life insurance policies that are available.
What “kinds” of no medical exam life insurance policies are available?
OK, so now that we’ve established that No Medical Exam Life Insurance Policies are life insurance policies that don’t require an applicant to take a medical exam to qualify (duh!), let’s now shift gears and discuss the various “types” of no medical exam life insurance policies that exist.
Top 2 Types of No Medical Exam Life Insurance Policies.
#1. Simplified Issue Term or Whole Life Insurance Policies.
These are the “types” of no medical exam life insurance policies that most folks think of when looking for a no medical exam life insurance policy. These policies will closely resemble traditional term or whole life insurance policies that will require one to “medically qualify” for coverage but won’t require one to take a medical exam.
Simplified issue life insurance policies will rely on other “sources” of information (which we’ll discuss later) to determine one’s current health status, including a series of medical questions within the actual application itself.
Where simplified issue…
Term or whole life insurance policies will differ from their traditional counterparts because most won’t allow an individual to apply for more than 1 million dollars in coverage, and most won’t offer a Preferred Plus rate class.
Which means that…
If you were hoping to purchase more than 1 million dollars in life insurance coverage or were expecting to be able to qualify for a Preferred Plus rate, choosing to purchase a simplified issue life insurance policy might not be the “best” option for you.
#2. Guaranteed Issue Life Insurance Policies.
Guaranteed issue life insurance policies are also life insurance policies that won’t require one to take a medical exam to qualify for coverage. The only difference here is that unlike a simplified issue life insurance policy, which will require someone to be able to “medically qualify” for coverage, Guaranteed issue life insurance policies won’t.
They will only require that an applicant be a US citizen, live with a state where the policy is offered, and meet the necessary age requirements for approval. Unfortunately, these “types” of life insurance policies will be limited to approximately 25,000 dollars in most cases and contain a Graded Death Benefit, which will limit when the policy will begin covering an insured for Natural Causes of death (typical wait time is two to three years).
How do no medical exam life insurance policies or Simplified Issue Life Insurance Policies work?
Now since most folks looking to purchase a no medical exam life insurance policy will want that policy to cover Natural Causes of death right away, we’re going to focus the rest of our discussion here in this article on Simplified Issue Life Insurance policies, which will require one to be able to “medically qualify” for coverage and won’t contain a Graded Death Benefit.
For those looking for more information about Guaranteed Issue Life Insurance Policies or Graded Death Benefits and how they work, please feel free to visit the following articles: Top 10 Best Final Expense Insurance Companies, and What is a Graded Death Benefit?
Now that we’ve made it clear that we’re going to focus the rest of our discussion on simplified issue life insurance policies and we’ve made it clear that these “types” of life insurance policies are going to require one to be able to “medically qualify” for them, let’s now take a moment and discuss HOW life insurance companies are going to determine whether your are HEALTHY enough for coverage.
The main reason most life insurance products require one to take a medical exam is to determine what “kind” of health an applicant is in before extending an offer of coverage to them. So, if an insurance company isn’t going to REQUIRE a medical exam, there must be some other “way” that they are going to determine your health status.
Seven Common Alternative “SOURCES” of information other than a MEDICAL EXAM.
Within the life insurance industry, there are seven routine ways a life insurance company will learn about new applicants applying for life insurance, aside from requiring one to take a medical exam. These alternative “sources” (as we like to call them) are quite effective in learning quite a bit about an applicant and is why more and more life insurance companies are realizing that they no longer have to rely so heavily on an exam.
These “sources” are as follows:
#1. Application questions.
The primary source of information that a life insurance company will rely on when a medical exam isn’t required will be the actual application itself. The main reason for this is that, in addition to asking many questions, a life insurance application acts as a legal contract, thereby requiring the applicant to be completely honest when completing it. For this reason, insurance companies will be quite thorough with their questions, which will typically look something like the following:
- What is your date of birth?
- What is your current height and weight?
- Have you been diagnosed with any pre-existing medical conditions?
- Are you currently taking any prescription medications?
- Have you ever been diagnosed with cancer, heart disease, or diabetes?
- Have you ever suffered from a heart attack or stroke?
- Have any of your immediate family members (mother, father, brother, or sister) ever been diagnosed with cancer, heart disease, or diabetes?
- Have any of your immediate family members (mother, father, brother, or sister) ever suffered from a heart attack or stroke?
- In the past two years, have you been admitted into a hospital for any reason?
- In the past 12 months, have you used any form of tobacco or nicotine products?
- In the past 12 months, have you used any type of marijuana products?
- Do you have a history of drug or alcohol abuse?
- Have you ever been convicted of a felony or misdemeanor?
- Do you have any issues with your driving record? Issues such as DUI, multiple moving violations, or a suspended license?
- Do you have any set plans to travel outside of the United States in the next 12 months?
- Do you actively participate or plan on participating in any dangerous hobbies or activities such as skydiving, hang gliding, or bungee jumping?
- In the past 12 months, have you filed for bankruptcy?
- Have you ever had a life insurance application denied or postponed?
- Do you currently have any other life insurance applications in process?
- Are you currently working now?
- In the past 12 months, have you applied for any type of disability benefits?
#2. Prescription database.
Insurance companies will also request access to an applicant’s prescription medication records recorded every time you are prescribed a medication by a US physician.
From there, insurance companies can then use this information to determine several things. Things such as:
- WHAT you have been diagnosed with in the past (based on what kinds of medications you have been prescribed).
- WHEN were you originally diagnosed with a particular medical condition (based on the date you were initially prescribed a medication).
- HOW well your condition is being treated (within reason, based on the consistency and types of medications being prescribed).
#3. Medical Records.
In some situations, even though an insurance company may choose not to require one to take a medical exam, they may require an applicant to provide them with access to one’s primary care physician’s medical records. This request may be based on information that they obtained within one’s prescription database or could simply be due to the SIZE of the policy you are looking to apply for.
#4. Credit Report.
Insurance companies may also choose to run a “credit report” on an applicant. And while bad credit isn’t necessarily a sign of any health issues, medical bills do account for one of the leading causes of bankruptcies, which may account for why some insurance companies may choose to order a credit report before making their decision.
#5. DMV Report.
Reviewing one’s driving record is a standard practice among most life insurance companies because aside from health issues, driving recklessly is one of the leading causes of death in the United States, once you rule out all other “health-related” causes.
For this reason, it only makes sense that an insurance company would want to know what “kind” of driver you are before they choose to approve your life insurance application.
#6. Criminal Background Report.
Many life insurance companies will automatically choose to deny any applicant who has been previously convicted of a felony. Now there may be many reasons behind “why” this is the case, however, the most reasonable one to assume is that they (the insurance company) don’t want to find themselves insuring anyone that may potentially go to jail in the future. And, if you have been convicted of a felony in the past, to them, this makes many companies assume that you are an unacceptable risk.
The good news is that not all life insurance companies feel this way. You’ll just need to make sure that you disclose this fact right away so that your insurance agent can avoid any company that will automatically decline your application.
#7. Previous Life Insurance Applications.
Another valuable source of information that most life insurance companies will have access to is called the Medical Information Bureau or MIB. This “source” of information allows different life insurance companies to “share” information with each other about previous life insurance applications.
Which means that…
If you previously applied for a life insurance policy two years ago, the results of that application (excluding specific details) will be made available to any company you are currently applying with. Now we say “excluding specific details” because the MIB won’t share “why” a life insurance company made a particular decision about your application. They’ll only share what decision they made.
If you applied for insurance six months ago and were DENIED coverage, the MIB won’t provide details on “why” you were denied; it will only say you were DENIED. The only real “specifics” that may be shared is if you are a smoker, in which case the MIB may indicate whether or not you were approved with a Tobacco rate.
So, as you can see…
Even though a Simplified Issue Life Insurance Policy isn’t going to require one to take a medical exam, it’s not as though the insurance company isn’t going to be able to “gleam” quite a bit of information about you without one.
This is why…
Even though a Simplified Issue Life Insurance Policy isn’t going to require a medical exam, once approved for coverage, your policy will be INDISTINGUISHABLE from a traditional term or whole life insurance policy that will require a medical exam! This is why so many people like these “types” of life insurance policies.
But just because…
A Simplified Issue Life Insurance Policy will essentially function the same way a traditional life insurance policy will does not mean that everyone should automatically apply for one.
Because the truth is, these “types” of life insurance policies may not be right for everyone. This is why we now want to take a moment and discuss who SHOULD and who SHOULDN’T apply for a Simplified Issue Life Insurance Policy.
When should someone consider purchasing a no medical exam life insurance policy?
As a general policy here at IBUSA, we always like to first consider a Simplified Issue No Medical Exam Life Insurance Policy. And then determine if there are any “factors” about an applicant that may make one of these “types” of life insurance policies a “poor choice”.
This is because…
Simplified Issue Life Insurance Policies are a great way to purchase an affordable insurance policy fast.
If your someone who doesn’t currently have any life insurance right now or are someone who needs to qualify for coverage fast to satisfy a loan requirement or a divorce decree, getting insured in less than 48 hours rather than having to wait a couple of weeks could be very important to you!
It’s been a few years since the last time you’ve seen a doctor because the last thing that you want to occur is to take a medical exam and have that exam identify that you may have:
- High cholesterol,
- High blood pressure,
- Or elevated blood sugar levels (diabetes).
The only problem is…
That because insurance companies will have less information to go one when making their decisions about someone who is applying for a Simplified Issue Life Insurance policy than they would a traditional life insurance policy, which would require an applicant to take a medical exam, these “types” of policies can be a “bit” more difficult to qualify for.
Which means that…
Someone who might be able to qualify for a Standard or better rate when applying for a traditional life insurance policy may find their Simplified Issue Life Insurance application DENIED. Now, are these “kinds” of folks UNINSURABLE? No, they’re not. They just aren’t going to qualify for a Simplified Issue Life Insurance Policy which brings us to our next topic.
Who should avoid these “types” of life insurance policies?
In our experiences here at IBUSA, we have found that individuals who have either had difficulty qualifying for insurance in the past or who believe that they won’t be able to qualify for anything better than a Standard rate (excluding type 2 diabetics) may want to avoid applying for a Simplified Issue Life Insurance Policy.
The reason for…
This is because oftentimes, taking a medical exam and providing further evidence of your current health status can oftentimes help someone with a pre-existing medical condition qualify for a traditional life insurance policy.
Just because someone has been diagnosed with a pre-existing medical condition doesn’t AUTOMATICALLY mean that they won’t qualify for coverage. It usually just means that the insurance company will want to learn more about your situation before they’re willing to make any decisions about your application.
If you’ve been diagnosed with cancer, heart disease, depression/anxiety, or if you’ve suffered from a previous heart attack or stroke, chances are you still may be able to qualify for a traditional life insurance policy. You’re just not going to be able to qualify for one that isn’t going to require you to take a medical exam.
This is why…
It’s so important to work with a true life insurance professional who will know what “type” of life insurance policy you’ll most likely be able to qualify for “before applying” for coverage and that also has access to dozens of different life insurance companies to choose from so you don’t find yourself trying to apply a…
“One Size Fits All”
Approach to your needs.
Someone like one of the many agents that work here at IBUSA! So, what are you waiting for? Give us a call today, and let us show you what we can do for you!