Life Insurance Without the Exam
B.A. Risk Management
Life Insurance Agent
Shopping for life insurance is an overwhelming process. There are dozens of companies to choose from, and that isn't even considering all of the different types of policies available. On top of that, some policies require an exam while others don't. To clear up the confusion, we decided to write this detailed guide to no exam life insurance. This guide will explain - in simple terms - everything you need to know about no exam life insurance.
What is no exam life insurance?
On the surface, it's obvious that it is life insurance that does not require the medical exam. But as you start looking into it, you realize there are several types of no exam life insurance. The three types are term life with accelerated underwriting, simplified issue life insurance, and guaranteed issue life insurance. Read on to learn which type of no exam life insurance is the best fit for your needs.
Term Life Insurance with Accelerated Underwriting
The first is the regular term life insurance. In the past five years, life insurance companies have introduced a modern method of underwriting. This is called accelerated underwriting. Nowadays, when you buy term life insurance below a certain coverage amount, you can potentially skip the exam if you are young and healthy. If you do not want to take an exam this route may make sense, but only if you are in excellent health. Any blemish on your medical record can cause you to have to take an exam. If you do not have perfect health, read on to learn about simplified issue life insurance.
Traditional policies with accelerated underwriting are great if you can qualify. Only the healthiest of applicants get to bypass the exam with this form of underwriting.
Best Companies for accelerated underwriting
- Mutual of Omaha - Mutual of Omaha offers its Term Life Answers product, which uses accelerated underwriting for those under age 60. As of July 27th, 2020, qualified applicants can get up to $2,000,000 of coverage without an exam.
- Protective - Protective uses their PLUS (Protective Life Underwriting Solution) on all of their life insurance products. This is their form of accelerated underwriting. It means that healthy individuals can avoid the exam in certain cases. Those ages 18-45 can get up to $1,000,000 of coverage, and those ages 46-60 can get up to $500,000. Note: Just because you are in these age ranges, does not mean you will qualify for accelerated underwriting and be able to skip the exam.
- Prudential - Prudential uses their PruFast Track underwriting, meaning those in good health between the ages of 18-60 can get up to $1,000,000 of coverage without an exam. Note: PruFast Track is not available for tobacco users.
- SBLI - SBLI offers an accelerated underwriting term life product called SBLI Express. It offers up to $500,000 of coverage for those ages 18-60. There is no medical exam required.
Simplified Issue Term Life Insurance
Before accelerated underwriting, this was the type of policy to buy if you wanted term life insurance without the exam. A simplified issue policy does not require an exam, but this is factored into the price. These are generally more expensive than traditional term life insurance. Simplified issue is a good choice if you want to avoid an exam and are older or in less than perfect health.
Simplified issue life insruance is priced slightly higher than traditional term life insurance, but there is no exam required. It is a great choice if you want to avoid an exam and are older or in less than perfect health.
Best Companies Offering Simplified Issue Policies
Sagicor offers a variety of competitively priced simplified issue products. Their Sage Term product offers up to $1,000,000 of coverage without an exam. There are coverage limits based on age.
- Age 18-45: Up to $1,000,000.
- Age 46-55: up to $750,000.
- Age 56-65: Up to $500,000.
Mutual of Omaha offers a simplified issue term life product called Term Life Express. This product offers up to $300,000 of coverage. There are coverage limits based on age.
- Age 18-50: Up to $300,000.
- Age 51-65: Up to $250,000.
Fidelity offers a simplified issue term product called RAPIDecision Express. It has coverage amounts up to $100,000 for those between the ages 18-65.
Guaranteed Issue Life Insurance
This type of life insurance is a whole life policy with a small death benefit usually under $25,000. This is the type of policy that is referred to as "no exam no questions asked" since there is no medical questionnaire or exam. However, there is a waiting period of 2-3 years where if the insured dies, the insurance company will not pay the death benefit. Instead, they refund the premium plus interest. If this seems like an option for you, consider these companies for guaranteed issue life insurance:
- Great Western
Guaranteed issue is used as a last resort for those that want coverage, but cannot get approved for any other life insurance products.
Traditional Term with Accelerated Underwriting vs No Exam Simplified Issue Life Insurance
The main difference between a regular term policy with accelerated underwriting and a simplified issue policy is the exam requirement. A simplified issue policy requires no exam, and it is priced accordingly. You can apply for a simplified issue policy with less than perfect health, and still not be required to take an exam.
With a traditional term policy with accelerated underwriting, you only avoid the exam if you are young - generally below age 45 - and healthy. There are also limited coverage amounts. Simplified issue policies typically max out at $500,000 where policies with accelerated underwriting can go up to $2,000,000 of coverage.
How does no exam life insurance work?
When you apply for life insurance, there are medical questions on the application. Your answers to these questions are used by the insurance company to assess your health and make a decision. The lab results from the health exam are also used in this process.
With a no exam policy, the insurance company checks several databases instead of looking at lab results. These are the Medical Information Bureau (MIB), your motor vehicle record (MVR), the national prescription database, and public records provided through the Fair Credit Reporting Act.
With accelerated underwriting, the insurance company looks at your answers to the health questions and the resulting checks from the various databases. They use this information to determine if you can proceed without needing to take a medical exam. There are also coverage limits that vary from company to company that will also determine when an exam is required.
No Exam Life Insurance Pros and Cons
If you are in the group that can go through accelerated underwriting, there are no pros and cons. You are in the best of both worlds. You get the cheaper coverage and get to skip the exam.
If you have some health issues and still want to avoid the exam, you will be looking at simplified issue life insurance. The pros and cons of simplified issue life insurance are as follows:
Pros of No Exam Life Insurance
- Fast turnaround time.
- No medical exam.
- No face-to-face interaction with a nurse.
Cons of No Exam Life Insurance
- Slightly higher price.
- Lower available coverage amounts.
- Shorter term lengths for older applicants.
- Potential to be declined based on health conditions.
How Much Coverage Can You Get Without an Exam?
The amount of coverage you can get depends on your age. $1,000,000 is the maximum amount of coverage offered and is generally available to those under 45. If you are between the ages of 55 and 70, you can typically get up to $250,000 of coverage. In addition to coverage amounts being limited by age, term lengths are also limited. Older applicants are limited to 10 and 15-year terms, while younger applicants may have access to 20 and 30-year terms.
Will I Qualify for No Exam Life Insurance?
Every life insurance application has a set of initial questions that can disqualify you. These are referred to as kill questions. While they vary from company to company, these questions generally relate to:
- Needing assistance with daily living activities.
- Currently being in the hospital.
- Being incarcerated.
- Anything relating to having HIV or AIDS.
- Having Alzheimer's, Dementia, Cirrhosis, Emphysema, or COPD.
- Recent treatment for cancer, heart attack, stroke, or alcohol or drug abuse.
- Recent DUI/DWI or license suspension.
If none of these apply to you, there is a good chance you can get approved for this type of life insurance. Every company has its own set of underwriting rules, but in general, you can qualify even with a few health conditions. The catch is that the price might end up being higher.
The Rise in Popularity of No Exam Life Insurance due to CoronaVirus
With the global pandemic, demand for life insurance has increased. This coupled with social distancing rules has led to an increase in the popularity of no exam life insurance. More than ever, companies are focusing their efforts on accelerated underwriting. Several companies have increased coverage amounts for accelerated underwriting. In regards to accelerated underwriting, Prudential has increased the coverage limit to $3,000,000, while Mutual of Omaha increased to $2,000,000 for those under age 60. There has never been a better time to get a no exam life insurance policy.
Price Comparisons of No Exam and Accelerated Underwriting Policies
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Term Life Insurance Quotes No Medical Exam
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No Medical Exam Life Insurance for Seniors Over 70
One of the most challenging circumstances when shopping for life insurance is being over the age of 70. With that being said, there are a few options.
If you are looking for life insurance for someone over the age of 70, and taking a medical exam is not possible, you may want to consider guaranteed issue life insurance. The death benefit will be lower and there will be a waiting period before it is eligible to be paid out in the event of a claim.
Our advice is to apply for a term life insurance policy and take the exam. You might be surprised at how well that can go for elderly applicants.
Simplified issue will not be an option for seniors as most companies limit the age qualification to age 65 or under.
No Exam Life Insurance for Those Over 60
For those ages 66-70, Pacific Life offers a simplified issue plan. For those 65 and under, you have the option of applying with a variety of life insurance companies that offer simplified issue life insurance. This age group does not have access to the accelerated underwriting plans, and therefore if you want to avoid the exam, simplified issue life insurance is the best option.
No Exam Life Insurance for Those Over 50
If you are over 50, you are nearing the cut off for accelerated underwriting. SBLI Express is a term life product that uses accelerated underwriting and is available for those up to age 60 with up to $500,000 or coverage. Prudential's term life insurance allows for accelerated underwriting up to age 60 with up to $1,000,000 of coverage.