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No-Exam Life Insurance Explained

Sep 15, 2020 4 min read Benjamin St. Jacques

Key takeaways

  • No-exam life insurance is convenient but can be expensive and limited.
  • Consider guaranteed issue insurance only if you have no other options.
  • Most people should opt for the medical exam when applying for life insurance.


If you’re like many Americans, you’ve put off buying life insurance because there’s a medical exam involved. Generally, the exam includes a physical, blood and urine tests, and an EKG.

Besides the hassle and time commitment, some people just want to avoid doctors, needles, and anything vaguely medical.

Now there’s an alternative that doesn’t demand a medical exam. But before you go that route, consider a few pros—and several cons.



What is medical underwriting?

Medical underwriting is a standard process that life insurance companies use to determine your health status and find out if you have any pre-existing conditions.

A medical exam is just one part of the process. Insurers will also ask you to complete a health questionnaire and submit medical records.

They use this information to determine how much coverage you can get. That’s why in general, the younger and healthier you are, the less life insurance will cost.


The no-exam difference

All life insurance policies generally work the same way: Once you’re approved, you pay a regular, usually monthly fee (aka premium) for coverage. If you die while covered, your beneficiaries receive the value of your policy.

The only difference with no-exam life insurance is that, well, you don’t go through the physical exam.

Sounds simple, right? But that difference carries advantages and disadvantages.


Why you might like it

People are drawn to no-exam life insurance because it offers:

  • Fast approval times.

    A no-exam policy can get approved in as little as 24 hours (or as long as two weeks).
  • No needles.

    Giving blood samples is the worst part of the exam for many.
  • Convenience.

    You don’t have to travel to a doctor’s office or wait for a nurse to come to your home.


Why you might not like it

Skipping the medical exam sounds great, but consider:

  • Cost.

    No-exam life insurance typically costs more than traditional policies. Without the full medical exam, providers take a bigger risk to insure you—and charge you more for the privilege.
  • Limited coverage.

    Most no-exam policies have a maximum face amount of $500,000. That may not be enough for your needs.
  • Less choice.

    There are only a few types of no-exam life insurance policies you can get.
  • Potential for no payout.

    In lieu of an exam, you’ll have to disclose everything you know about your health. If you die from something you didn’t disclose, the insurer could withhold your death benefit from your beneficiaries.


Types of policies

No-exam life insurance comes in three basic flavors:

  1. Simplified issue.

    You won’t need a medical exam, but you’ll have to answer a long list of questions about your medical history, use of drugs and alcohol, hospitalizations, family history, and more. The insurer may also ask for motor vehicle records and results from previous life insurance applications.

  2. Guaranteed issue.

    These policies are for people ages 50–85 who have serious health conditions and typically can’t get coverage otherwise.

    You can only buy $1,000 to $25,000 in coverage—and it’s expensive. (Not only won’t the insurer conduct a medical exam; they won’t even look at your medical records—so they’re assuming a huge risk.) Also, “guaranteed” is a misnomer—applications can be rejected for certain reasons.

    Finally, most of these policies have a “graded death benefit.” This means they won’t pay the full benefit if you die within the first couple years of purchasing coverage. It’s no wonder most people see this type of insurance as a last resort.

  3. Group coverage.

    Many employers provide this insurance as a benefit, usually at a lower cost than you can find on your own. Besides no medical exam, you might not have to answer medical questions to get coverage.

    Employers typically offer coverage equal to one year’s salary at no cost to employees. (Free insurance? That’s a no-brainer.) You can then choose more coverage, which you’ll have to pay for. Payments come directly from your paycheck, so you probably won’t even notice it.

    Just know that how much insurance you can get through your employer is limited—usually no more than 10 times your salary. So, if you make $60,000 a year, that’s $600,000 of coverage. It may not be enough to meet your needs. And if you leave your job, you can’t take your group policy with you.


Bottom line

Simplified-issue coverage may not be as simple as it sounds, but getting it can be quick, convenient—and expensive. If you can get group coverage at work, great—but understand that it’s not portable if you leave your job. And consider guaranteed-issue coverage only if you have a serious medical condition that would make you ineligible for traditional insurance.

But if you’re relatively healthy—or even if you have pre-existing health conditions—you may be better off with full medical underwriting than no-exam life insurance. Putting up with a little inconvenience and a quick needle stick can be worth the extra coverage (at better rates) that you’ll probably get.


What you can do next

If you don’t have life insurance—and you have dependents—think about purchasing a policy sooner rather than later. The younger and healthier you are, the better deal your coverage will be. Talk to a financial professional about what type of policy may be right for you.



Benjamin St. Jacques is a writer for Prudential, covering life insurance, annuities and workplace benefits.


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