If you have been holding off on getting life insurance because you were worried about the exam that precedes a policy approval, there is good news for you. Not every kind of life insurance requires that you go through the exam procedure.
Before you commit to no exam life insurance, you should be aware of all the pros and cons of doing this. Read on to learn more about these policies and whether it might be the right fit for you.
Pros of a No Exam Life Insurance
Of course, the process of applying for this life insurance is easier because you don’t have to go through the exam. This often eases a lot of your fears about application and is one less hassle.
Applying for life insurance does not have to be hard, and no exam life insurance proves that. No exam offers the ability to apply online or on the phone with an agent, which is then signed electronically. This means no paperwork, so there is definitely a good convenience factor.
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In addition, it is often easier to get coverage more quickly when it comes to no exam life insurance. There is not as much medical information for an underwriter to review, even though your case will still be underwritten. The lack of a medical exam just means that your policy will be processed more quickly. Approvals can range from instant to just a few days depending on the company.
Often times you may also uncover a condition that you didn’t know you had by taking the medical exam, this can cause your rates to skyrocket, by opting for no exam life insurance, you get to skip the anticipation of bad news and lock in coverage at a healthy rate.
Cons of a No Exam Life Insurance
Even though it is easier to get no exam life insurance and frequently faster, there are downsides. To start with, the premiums on these policies can be a bit more expensive when compared to more traditional policies like traditional term life. You also have to be in somewhat good health to qualify.
They also tend to have caps on their coverage, so you will not be able to max out on the policy benefits. This is a tradeoff for being able to get coverage without having to go through an exam, but it might mean that the policy does not fully meet your needs. Make sure you check out the caps before you get started with shopping for no exam life insurance. Caps on coverage can range from $250,000 to $400,000 with a$1,000,000 no exam life insurance policy possible in rare cases.
Also, be aware of renewal and conversion clauses. This means that you can convert to a carrier’s permanent plan or decide to renew the term on a guaranteed basis no matter the state of your current health. In some cases a life insurance policy with no exam will not have one of these clauses, largely due to the fact that the insurer is taking on a bigger risk by not requiring an exam.
Make sure that you are clear up front about whether your policy has a renewal or conversion option. This is not something you want to realize you missed down the road if your health declines and it becomes more difficult to get another policy.
Finally, be clear that your policy is not just accidental death coverage. You do now want your family members to make the unfortunate discovery of realizing that the policy does not pay out in all situations, so you should know ahead of time what stipulations the policy has as far as events that warrant policy benefit payment.
Overall no exam life insurance can be a great option for those looking to get life insurance fast or just prefer the convenience of skipping the exam. However if you need a larger coverage amount or are considered a high risk, you may want to opt for the traditional exam life insurance.
Photo Credit: David Hilowitz