Can I get affordable life insurance without a medical exam?

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Here's what you need to know...

  • When you’re applying for a standard fully underwritten life insurance policy, it’s typical for companies to require a medical exam
  • Medical exams are required because they help life underwriters review an applicant’s health status at the time of the application was submitted
  • Some policies exist that do not require an explicit medical exam, known as no-exam life insurance
  • The ultimate purpose of a medical exam is to assess life expectancy and to determine if there are unexpected risks that weren’t found on the application or within medical records
  • While standard guaranteed level term insurance policies require medical exams, some annual terms don’t require a medical exam
  • Younger applicants and applicants who don’t have prior health issues may be able to forego an exam requirement as well
  • If you choose to buy a sub-standard ‘no exam’ policy, expect to pay higher premiums because the company is undertaking more risk

To some consumers, the idea of taking a medical exam to qualify for insurance is terrifying. Whether you’re scared of needles or you feel like the exam itself is an invasion of your privacy, there are reasons that you as a life insurance buyer might want to shop for term life insurance policies that don’t require medical underwriting exams. The question is whether or not it’s possible to find a policy with the death benefit that you need at a price that you can afford. Compare life insurance rates now by using our FREE tool above!

In the world of life insurance, there are standard providers and substandard providers. Each of these carriers attract a different targeted niche and offer a different menu of financial products. As a consumer, you should be able to differentiate one product from another after you’ve learned how applications are underwritten. Here’s your guide to life insurance underwriting and policies with ‘no medical’ requirements so that you can decide if these specialty products are right for you.

How Life Insurance Companies Classify Insureds and Determine Rates

As with all for-profit companies, life carriers are in business to make money. Since companies are offering hundreds of thousands of dollars or even millions of dollars in life benefits, the rate makers must do their research to evaluate and estimate how long a specific client will live. This is why companies use several different rate classes to evaluate an application, estimate life expectancy and then to determine an applicant’s personal rates.

What are the most common rate classifications?

A rate classification is what insurance companies use to place an applicant into a category where there is clearly defined premium rates. The rate class is essentially an applicant’s risk level when that risk level falls into a common category. Here are the most basic risk classifications that are used in the industry:

  • Preferred Plus: The most affordable risk class that is associated with excellent health, normal weight, and no other family risk factors that could affect life expectancy.
  • Preferred: Rating for applicants with excellent health who might have a minor health issue or a family history.
  • Standard: Offered to people with normal life expectancy that might have some medical issues. Standard applicants can be overweight or have pre-existing conditions that disqualify them from a preferred class.
  • Preferred Smoker or Smoker: Tobacco users receive their own classes because of the unique risks that smoking presents. If you’re in good health other than being a smoker, you could receive a preferred rating. Otherwise, you’ll be a standard tobacco rating or table-rated because of other health issues.

Why are medical exams such an important part of the underwriting process?

If you’ve ever applied for your own standard individual life insurance policy, you’ve probably been asked to attend a paramedical appointment where the service provider checked your height, weight, urine, blood, and saliva. Having your fluids collected can feel a bit intrusive, but the purpose behind the medical exam is very important in the industry when it comes to determining accurate rates.

Without medical exams, insurers would have to trust all of the information that you disclosed on your application.

The only thing the company could possibly find is medical conditions you’ve been diagnosed of in the past. Since many medical conditions have yet to been diagnosed, companies need for applicants to undergo a medical exam to look for red flags. Requiring the medical exam gives the company the ability to look at your habits and whether or not they affect your own life expectancy compared to the national average.

Is it possible to find life insurance without taking a medical exam?

It might not be easy to find a standard guaranteed term policy that doesn’t require a medical exam, but there are products in the substandard market that might appeal to you if you’re adamant about skipping the exam. Substandard insurers offer products to higher risk applicants in exchange for higher premiums.

Why are the premiums for no medical life insurance higher than standard premiums?

If you solicited a quote for a standard 20-year term and another quote for a no medical policy, you would find that the premiums are almost always guaranteed to be higher for the no medical product. This is true even when you’re young and in good health. The primary reason for this is because the applicant doesn’t authorize the carrier to collect medical records or specimens for testing. Therefore, the carrier must go on your word and charge a higher premium to cover the added risk.

The Benefits of Being Young

If your parents purchased a permanent cash value policy on you while you were a minor, you might already have coverage in place. Some of these permanent plans or child term life riders give you the right to buy coverage by converting the benefits into a standalone term life plan. Some companies will go as far as to offer young applicants applying for term insurance with low death benefits coverage at a standard rate without a medical exam.

The Drawbacks of Annual Term Insurance

Most ‘no medical’ life insurance policies are called annual terms.

When you apply for an annual term you can forgo the exam requirement but your rates will go up every year as you age.

Since rates are reviewed each year, it’s common for an annual term to skyrocket once you reach a certain age. A comparison of rates between level terms and annual terms shows this fast climb.

Who can benefit from no-exam life insurance?

If you need your life insurance to be issued quickly, choosing a policy that doesn’t require full underwriting might be ideal. The policies are issued in a short amount of time so that you can get that immediate coverage you need.

The best way to do your research on pricing is to use a comparison shopping tool. If you find that it’s still affordable for you to buy no-medical life coverage, apply for it while you can. When your policy is issued, consider preparing yourself for a medical exam so that you can lower your life rates for the future under a standard plan. Enter your ZIP code in our FREE tool below to compare life insurance rates now!

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