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The Ultimate Guide to No Exam Life Insurance

Posted September 10, 2013 | Filed under topic Types of Life Insurance Coverage

It comes as no surprise that no exam life insurance is becoming a popular option for many individuals and families. For many people, the arduous application process associated with traditional policies is enough of an excuse to put off purchasing coverage.

Life insurance medical exams require you to:

  • Undergo a basic physical
  • Provide a urine specimen
  • Get blood work done
  • Receive an EKG and an X-ray

Because some consumers are not willing to go through that process, and others are afraid of being rejected on the grounds of pre-existing conditions, more and more providers are responding to the rising demand for no medical exam life insurance. While it’s much faster to get this kind of coverage, in most cases you’ll still have to answer some questions about your health. You should expect to be asked about:

  • Any regular habits or lifestyle choices that may affect your health, such as smoking
  • Ongoing medical problems
  • Major medical treatment or health issues you’ve had in the past

It’s important to note that not everyone qualifies to skip medical exams. Even if your answers to the health questions are satisfactory, the policy provider may still check Medical Information Bureau, motor vehicle, and pharmacy reports for verification. If you answer accurately and honestly, and you’re in good health, there is a high probability you will be accepted. However, if there are complications with your health, it’s also possible you’ll be offered ‘graded death benefits.’ If you have this kind of policy, a full payout is only available after a waiting period that is determined by your level of risk, which is usually at least two years. Here’s a good explanation of graded death benefits.

When No Exam Life Insurance Policies are the Best Option

There are many situations that could make it necessary for you to avoid a medical test. If you fall under any of the following categories, you might want to opt for a ‘no test’ policy.

You Need Life Insurance ASAP

If you are trying to secure coverage in order to qualify for a loan, protect yourself before setting out for a long trip, or achieve peace of mind because you’re a new parent, you may want a policy right away. It can take four to seven weeks to secure life insurance coverage that includes a medical exam. Skipping the health tests usually means you can get a policy within 1 to 2 days.

It’s Been a While Since You Had a Checkup

If it has been more than three years since you last visited your doctor for a checkup, and you received a clean bill of health the last time you went, it might be wise to skip the medical tests. You know how they say lawyers should never ask questions in court if they don’t know the answers? Well, life insurance consumers shouldn’t get tests if they aren’t confident about the results ahead of time. Once you’ve secured coverage with your clean health record, then you can go get that checkup to make sure all is still well.

You Haven’t Been Able to Get Traditional Coverage

If you’ve already exhausted your traditional coverage options, you don’t really have a choice. As stated above, you also can be denied for some no exam life insurance policies, but there are some companies that offer ‘guaranteed’ policies with zero questions asked. If you have a dangerous occupation, serious health issue, or some other mark against you, it’s just a matter of finding a company that will allow you to pay a high premium to offset the risk they are taking in insuring you.

Weighing the Costs of No Exam Life Insurance

It’s important to remember that these policies cost more. Life insurance companies base premiums on the amount of risk they face, and they group policies into three risk levels. Here they are from lowest premiums to highest:

  1. Non guaranteed – policies that ask detailed health questions and require medical tests
  2. Simple issue – policies that ask general health questions and don’t require medical tests
  3. Guaranteed – policies that do not ask any health questions or require any tests

Unless you have a pre-existing condition that has prevented you from getting any other kind of coverage, you should probably avoid the guaranteed category. Simple issue policies can be double the price of non guaranteed, while guaranteed can be as much as four to five times the price of non guaranteed.

If you know you are in good health and you aren’t in a rush, you’re going to have to determine the value of convenience you get from skipping the medical test. Are you willing to pay up to twice as much every month just to avoid a trip to the doctor?

If you have a serious pre-existing condition, no medical exam life insurance options could be a godsend. Yes, you will have to pay higher premiums, but in return you get the peace of mind that comes with knowing your loved ones will be financially secure.

Making the Right Choice

It’s important to make the right decision when choosing the level of information you’re willing to share with a potential policy provider. If you apply for a non-guaranteed policy and are rejected, it will go on your record and significantly affect the premiums you pay in the future. This is why it pays to do your research on companies, especially if you are dealing with a pre-existing condition.

At the same time, you don’t want to pay significantly more for your coverage if you’re confident you can pass a health exam. Either way, the best place to start is by collecting quotes from a number of the top providers in your area. By seeing the actual costs you will face, it will be much easier to determine whether or not the potential savings justify the risk of getting rejected after a medical test.

The bottom line is that ‘no exam’ options make coverage available to a much wider group of individuals. If you can afford the higher premiums, pre-existing conditions don’t have to prevent you from providing financial security to your loved ones. Many people are unaware of their options, so please share this guide to raise awareness. Then you can start comparing no exam life insurance quotes for yourself.

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