No Exam Life Insurance Offers Coverage + Peace of Mind
If you’ve come to the conclusion that you need life insurance, congratulations. Life insurance is one of the best ways to ensure that your family will be taken care of in the event of a tragedy. Deciding to buy life insurance, however, isn’t the hard part. Deciding which kind of policy and how much coverage you need is much more daunting. This is especially true today when there are many alternatives to traditional life insurance policies. One popular alternative is no exam life insurance.
No exam life insurance allows you to get coverage without the need to undergo a medical exam. Traditional life insurance policies require a medical exam of all applicants because it helps insurers assess their risk. No exam policies, on the other hand, allow applicants to forego this inconvenience and still get coverage.
Of course, since no medical exam is required, insurers must find other ways to cover their risk. One way they do this is by including a health questionnaire and collecting information from third-party sources. The latter includes your prescription records, previous life insurance applications, driving records, and credit reports. By gathering this information, insurers can get a more accurate view of the applicant and determine the monthly premiums.
Types of No Exam Life Insurance
Another way insurers cover their risk is by limiting coverage of no exam life insurance policies. There are two main types of policies: guaranteed issue (GI) and simplified issue (SI). GI policies don’t require any health information from applicants, and thus, coverage is capped at $25,000 or $50,000 at the most. SI, on the other hand, does require health information from the applicant, and thus, coverage can go up to $500,000 or $1 million.
People who apply for GI usually do so as a last resort, if they’ve been turned down for other insurance policies but still want to leave a little something to their loved ones, if not only for funeral expenses. People who apply for SI, though, are usually younger and in better health, They could probably get coverage for a traditional policy, but the requirement of the medical exam is a turn-off. Therefore, they turn to SI as a way of getting coverage without the hassle.
People who could benefit from SI no exam life insurance include:
- Stay-at-home partners
- Single parents
- Small business owners and freelancers
A common myth is that stay-at-home partners don’t need life insurance, but again, it’s a myth. Most stay-at-home partners perform tasks that are worth thousands of dollars, including cooking, cleaning, taking care of the children, scheduling doctor’s appointments, chauffeuring to extracurriculars, and so much more. If something were to happen to this partner, the surviving partner would need to outsource all that work or take time from their own job. Either way, the cost could be astronomical. No exam life insurance can provide coverage to a stay-at-home partner without requiring any inconvenience.
It’s easy to understand why a single parent should have life insurance, but in many cases, the cost can be off-putting. Additionally, single parents are often so busy being the primary caregiver and breadwinner that they don’t have time to take off for a medical exam. In this case, no exam life insurance is a good option. SI rates are often very similar to those of traditional life insurance policies, especially for people who are young and healthy. (Get a free quote here.)
Plus, the application process can be done entirely online and over the phone, so you don’t have to take off unnecessary time. The other benefit of SI is that approval takes a few days to a few weeks, unlike traditional policies, which take between 4-6 weeks.
Small Business Owners and Freelancers
Many families rely on small business owners and freelancers for their income, so it’s understandable why significant life insurance coverage is important. Moreover, small business owners who seek an SBA loan are required to have life insurance in place. SI is often the policy of choice since it grants quick approval and can offer coverage up to $1 million.
Someone who owns a home that has a significant mortgage would do well to have life insurance. After all, no one wants to leave their loved ones with an extra debt in case they pass away early. A no exam policy is a good way to get a high amount of coverage without having to inconvenience yourself with a medical exam. Additionally, if you have any medical issues, you run the risk of being turned down for a traditional policy, but you could likely still get approved for SI.
Figuring Out Your Coverage
If SI no exam life insurance sounds like it could be right for you, your next step is to figure out how much coverage you need. While there are many policies that offer up to $1 million, your first question needs to be, do I need that much? Most people don’t. The reason it’s important not to overshoot your coverage needs is that your monthly premiums will be higher if your coverage is higher. If you’re committed to buying life insurance quickly, make some calculations to determine how much coverage you need, and don’t delay another minute.