Brilliant Review Corner

No exam whole life insurance explained

No exam whole life insurance explained

Article by Philippe Deray

No exam whole life insurance is not much different than regular whole insurance. And the differences are rarely worth the trouble of getting an exam plan with full underwriting and weeks of waiting. We will give you more details on no exam whole life, its advantages and disadvantages and when it is best to select it or not. Read on…

What is no exam whole life insurance?

Simply put, no exam whole life insurance is a simplified whole life insurance that does not require an insurance exam as part of the underwriting process. In most cases, only an application is required and possibly a quick phone interview. Once these requirements have been met, you should have a final answer on your no exam whole life coverage within 24 hours. Some no exam whole life plans are really simplified in that they do not even ask any health questions. While, some will not require an exam but request medical records (although that is very rare). With most plans, a variety of health questions need to be answered and those questions can greatly vary for company to company. Keep in mind that the less you need to do to qualify for the policy the higher the premiums and/or lower the benefits (read you policy when it arrives!)

How much no exam whole life can a person qualify for?

If there is one major difference that distinguishes no exam whole life insurance with exam required life insurance plans, that is the size of the face amount. Depending on the insured’s age, no exam whole life face amount may be limited to as little as ,000 and be as high as 0,000. For example, an 85 year old may be able to only qualify for a maximum of ,000 in no exam whole life while a person under the age of 50 may be able to get as much as 0,000. The amount of insurance that you apply for does not usually affect the underwriting process.

What riders are available with No Exam Whole Life?

The second mot common difference between no exam whole life and full underwriting life insurance (exam required and more) is the riders. In most no exam whole life plans riders may be limited to just accidental life insurance. With that rider, if the insured dies in an accident, the regular death benefit plus and additional death benefit is paid to the insured. Other riders such as the waiver of premium, other insured rider, child rider… may not be available. Rider availability may also be greatly affected by the insured’s age. In many no exam whole life insurance plans, we have often seen the critical illness rider automatically included. Due to the many variations of this critical illness rider I suggest you ask your insurance company or broker about it.

What if you have pre-existing health conditions?

If there is one big benefit that no exam whole life can provide individuals, it is its flexibility of approval and wide acceptance of past or present health issues. With no exam whole life, in many cases, pre-existing as well as past health conditions can be acceptable for underwriting. It can often be the only plan that will allow someone to get quality life insurance… Please note that is some cases the insured may only qualify for a graded or modified no exam whole life insurance as opposed to a level no exam whole life insurance plan. A modified or grade plan will usually limit the amount of the death benefit during the first two to three year of the policy. Note that, just because one insurance company has declined you, does not automatically mean that others will to. If you have been declined for no exam whole life insurance, keep looking and be as specific as possible in your online search. For example, if you are a diabetic you may want to type in “no exam whole life insurance for a diabetic”. Some insurance companies may specialize in a certain illness while another may not. One more thing, if have been previously declined (usually in the past one to two years) some insurance companies may not offer you any coverage. Try to avoid a decline but don’t worry, most companies we have seen do not care to ask about your previous declines.

Things to look out for in the no exam whole life insurance plans

Not all No Exam Whole Life plans are the same. A lower premium on one plan that seems to be the same than another may indicate major differences. One major difference could be in the way the death benefit behaves over time. Many people are aware of the limited death benefit we mentioned above in the case of a graded or modified no exam whole life insurance. Few look at the later years of a policy. For example, if you examine your policy, the benefit page should show you the death benefit value on a year by year basis. If you bought a ,000 policy then it should show ,000 from the first year of the policy all the way to age 120. If the policy you bought is a graded or modified plan, the first few years (usually 2 to 3) may show a smaller benefit than the face amount you applied for. With some graded or modified policies, for example, the first two years may show your premiums paid plus some interest as your death benefit. Another important thing to look at is in the later years of the policy. Some policies have decreasing face amounts either year after year or by a certain age (often age 75). For example, a policy may start with a death benefit of ,000 but decreases to a death befit of ,000 by age 70 and continue decreasing after that. Please read your policy proposal pages carefully and ask questions.

Who is most likely to apply for no exam whole life insurance?

We have seen people of all ages show an interest in no exam whole life but the most popular ages are between the ages of 0 and 12 and 65 and 85+. For younger ages, you may see these plans offered as children whole life insurance or grandchildren whole life insurance. With older ages, you may have seen these plans called final expense whole life , burial life insurance, senior whole life or some other variations of these names.

I hope that this article gave you a better understanding of what is no exam whole life insurance. It is your responsibility to make sure that you have the plan you think you have so read your policy carefully when it arrives. As we say in all of our articles, please ask a lot of questions before during and after you have applied for life insurance. Be well!