Life insurance policies are available with an exam required or not. Whe
ther no exam life insurance is a good option for you depends entirely on your personal situation and preferences.
There are significant pros, but also some cons you should understand before deciding if a no exam policy is right for you.
Pros
No Exam
As it name makes clear, life insurance without an exam doesn’t require a visit from a parmedic. You do not have to have blood and urine samples taken. For some people, this is a major plus, particularly since the examiner is not someone you know.
If you don’t like being examined by a stranger, hate the poking and probing of blood tests, and just generally would do almost anything to avoid this, then a no exam policy relieves you of that hassle.
Simple Application
When underwriting is involved, getting life insurance can be an involved process. With a no exam policy, the application process is easy, with a minimal amount of information requested. There are some health questions that you must be able to answer no to qualify for this type of coverage.
Quick Coverage
When a medical exam is required and an underwriter must approve your application, the delay between deciding to buy life insurance and actually having life insurance in place can be too lengthy for many people’s comfort. Once you realize the vital importance of life insurance coverage, you may not be able to stand the thought of being without it. (There are options for conditional coverage on an undwritten policy that all for immediate coverage as well).
A no exam policy eliminates that wait, often going into effect very soon after you apply.
Cons
Can Be Difficult to Qualify
When applying for life insurance with no exam, the company offering the policy asks qualifying questions about your health,and they rely heavily on these, your age and your height and weight. (They will check the Medical Information Bureau and an Rx Database to confirm your answers.)
As you age, it will become more difficult to qualify for life insurance without an exam, and the maximum death benefit you can get will decline. You simply might not be able to get as much coverage as you need.
Cost
Since the life insurance carrier has much less medical information to evaluate their risk, it will generally set its no exam prices higher than insurance with full medical underwriting. For this reason, no exam policies are almost always more expensive than policies that require a medical exam.
In your 20’s you may see little difference in the cost of a no exam policy vs. a fully underwritten policy. By the time you are in your 50’s the difference can be substantial. Also, as you have more and more medical issues, no exam insurance may not even be an option for you.
Lack of Choices
No exam insurance tends to be limited in flexibility when it comes to how policies are structured. You may have needs for riders (e.g., critical illness rider) that you can’t find with no exam policies.
The Bottom Line
No exam life insurance exists for a very good reason—it offers exactly what many people want. You should carefully consider your options before deciding which type of insurance will best suit your needs.
You should consult with an experienced independent life insurance agent to explore how different types of insurance will fulfill your particular needs.
