How Does No Medical Life Insurance Work?

Posted on April 28, 2018

Life insurance can offer a valuable peace of mind for both you and your survivors.

With that in mind, there are numerous options for different policies and coverages. Interested in no medical life insurance? Maybe you've heard about it, but you're not exactly sure how it works or what it entails.

We've got you covered. Let's get into it!

What Exactly is No Medical Life Insurance?

In general, it's a form of life insurance, which means that it provides financial planning and coverage for your estate after your death.

Typically, when you apply for traditional life insurance through a broker or your employer, you'll experience the entire underwriting experience.

In doing this, the insurance companies will be able to determine how "risky" you are to insure.

The proof lies in the medical exam, where you'll be measured for your height, weight, blood pressure, and pulse. You'll also likely have to provide lab tests and urine samples. Finally, you'll have to provide information about any conditions you had or currently have.

it's a complete assessment that can take anywhere between 30 minutes to an hour with the intention of being completely comprehensive.

For many, this kind of exam can be invasive or inconvenient. Perhaps, you're worried about how your health results will impact the rates. Perhaps, you already know you are in poor health due to preexisting conditions or certain lifestyle choices.

With no medical life insurance, you do not need to undergo a medical exam. As a result, you can receive faster approval within as little as 48 hours.

What Are The Different Types of No Medical Life Insurance?

Think you're a good candidate for this kind of insurance? There are two main types of no medical life insurance policies you can consider.

Guaranteed Issue Life Insurance

Though this is one of the priciest forms of life insurance, it does not require any medical exams or access to medical records.

In fact, you may only need to answer 4-12 health questions in order to receive coverage.

These questions are usually regarding nicotine, AIDS/HIV status, and whether or not you've been declared terminally ill.

Typically, these policies have a "graded death benefit." This means that, if you were to purchase the plan and die within a designated timeframe (typically 2-3 years), the beneficiaries would only receive the premium and any interest.

Simplified Issue Life Insurance

With simplified issue life insurance, you can still bypass the medical exam. However, you will be asked relevant medical questions, and the company will have permission to examine your medical records.

Compared to the guaranteed issue life insurance procedure, you will likely be asked more questions regarding:

  • Your current employment
  • Physical activity
  • History of disability
  • AIDS/HIV status
  • Narcotic or controlled substance use
  • History of chemotherapy
  • Needing assistance with basic hygiene activities

Each insurance provider will have a different set of questions. You can expect to pay much less for simplified issue life insurance, but your chances of denial are higher.

When Should You Buy No Medical Life Insurance?

Typically, the following populations would benefit from no medical life insurance:

  • Those who have been denied standard life insurance
  • Individuals with chronic issues like cancer, heart disease, or diabetes
  • Employees that work in hazardous careers, like roofing or logging
  • People who have been convicted of impaired driving in the past
  • You don't want to undergo a medical exam

In general, these policies are best for those who need or want life insurance but cannot receive it due to medical concerns or lifestyle choices.

How Much Coverage Can You Buy?

When you purchase this form of life insurance, you may be limited in the amount of coverage you can receive compared to a traditional unwritten policy.

With guaranteed issue life insurance, the coverage limit is typically around $25,000. It's important to compare this figure to traditional life insurance payouts. Those can pay upwards of a million dollars if desired.

Simplified issue life insurance typically has a maximum limit of $150,000.

As with purchasing any insurance plan, it's important to read all the fine print, terms and conditions. You'll want to make sure you understand exactly what coverage you're purchasing.

What About Additional Coverage?

Some companies will allow you to purchase riders or extended coverage for other circumstances.

Accidental Death

You may be able to sign up for additional benefits if it is deemed that the cause of your death was accidental. However, because accidental deaths tend to be rare, especially in old age, this may not be worth the price.

Critical Illness

If you develop a critical illness like cancer, stroke, or heart attack, you may be able to receive additional payouts.

Finally, some no medical life insurance policies will specify a particular age when you will no longer have to make monthly or yearly payments. This is usually around age 95.

How Can You Save More Money?

Just like buying any insurance plan, comparison shopping is your friend. Get a few different insurance quotes you sign any contracts. Yes, this may be tedious, but you could end up saving thousands of dollars.

Furthermore, there may be multi-life policy discounts. If you and your spouse both get insured, you can get a cheaper rate than if you were to apply independently.

Finally, consider the virtues of paying annually over monthly. This could help you save thousands of dollars over the course duration of your policy.

Just make sure that your wallet can handle it!

Final Thoughts on No Medical Life Insurance

Part of being socially and financially responsible includes taking care of both your life and your death.

Interested in applying for a no medical life insurance policy? Get a free quote today!

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