Why People May Select No Exam Life Insurance and Probably Should Not
To make sure that we stay on topic, we will just give you a fast explanation of what no exam life insurance is. These types of plans were produced by need from agents who felt that the traditional way of underwriting life coverage was simply too complicated and took too long. With a no exam plan, you could just answer a few questions on an application, do a phone interview and voila, you get a final answer in a matters of a few days (sometime one day). observe that some companies may also check outside supplies of information such as MIB, pharmacy report, MVR… You may not always get approved, but, already if declined, at the minimum you tried and now you have an answer.
already when approved, no exam life insurance should be used for very specific purposes, not every time someone needs life insurance. Below are the top reasons for people to decide that a no exam plan is the best choice or the only choice they have and why it may not be.
Reason one: I was turned down for a no exam plan then no one will cover me
We do not believe that people do understand no exam life. Many may think that if you apply and you get turned down then that’s it, no one else will approve you. After all, won’t doing an insurance exam just make things worse? On the contrary! If you have been turned down for a no exam plan, the next best step is a complete underwriting, exam required life insurance. You see, a no exam required course of action is kept very simple and consequently the insurance company will not request more records if any negative information does surface either from the application, an MIB check, a pharmacy report… Because they won’t, they may not be able to give you an approval.
Reason two: An insurance exam may show positive lab results (bad lab results)
Simply put, the percentage of people who find that they have a medical issue because an insurance exam is very small. It certainly is ot worth the risk of paying so much more for a no exam plan. observe that, some companies will allow you to contest positive lab results and may allow you to repeat the exam at their or your expense. If you are nevertheless concerned about an insurance exam, you may want to first obtain a no exam plan then apply for a complete exam plan next and possibly get much lower rates.
Reason three: It takes too long for an answer
There is not disputing that a complete underwriting, exam required plan, may take longer and sometimes much longer to underwrite than a no exam life insurance plan. It does not have to be a huge gap between the two though. Here are some tips on how to thin that gap:
- The biggest time waster – Medical records. If you are able to, get your own medical records and forward them to the agent or the insurance company. Most insurance companies will be OK with that. That could save you weeks!
- Schedule your exam appointment for as soon as possible. Some insurance companies will not already order medical records until the exam has been done and results are known.
- Respond to calls from the insurance company right away. Some companies will need to talk to you before they proceed with the application. Call them back ASAP. Many have functional early and late hours for interviews (that applies to no exam plans too!)
- Thoroughly answer all questions on the application – You would be surprised how many days can be wasted because you did not give complete answers to all questions or skipped questions altogether.
There may be more ways to shorten the underwriting time but the above are the top ones. Stay on top of things and you may be able to get a final answer in just a few days and save a buddle in premiums in the time of action.
Reason four: I have bad health
Believe it or not, bad health is truly a good reason to select a complete underwriting, exam required plan. When you tell an insurance company that you have bad health but you want to limit the amount of information they can gather by selecting a simplified no exam plan, you are more likely to get declined. You see, most insurance companies give better underwriting results with lots of information on your health and other history. With bad health, you are also more likely to land lower rates with a complete underwrite plan. So, if you have bad health, do an exam plan.
There probably many other reasons for people to feel that a no exam plan is a better choice but the above are most shared. By all method, we did not say that you should always do a complete underwriting plan with an exam. There are times when a no exam plan is best and should be considered but that is for another one of our articles. If you have doubts or questions about which to choose, please feel to contact us. Be well!