Should I Get a No Medical Exam Life Insurance Policy Even If I’m in Good Health?

If you’re in excellent health, is skipping an underwriting medical exam a time-saving move or money-wasting mistake? It comes down to which of several options for a life insurance policy with no medical exam you’re considering.

What Is No Medical Exam Insurance?

Generally, when you’re applying for life insurance, the insurance company requires you to complete a health assessment. Details about your health help underwriters calculate your risk (and what rates you’ll be offered for a policy). A medical professional does a basic checkup and collects blood and urine samples to test for a fuller picture of your health.

In some cases, though, an insurance company might offer policies without doing this in-person medical workup. It can be more convenient to skip a medical exam and blood draw, but it’s important to consider whether up-front convenience will mean greater cost in the long term.

Types of Life Insurance Policy With No Medical Exam 

There are multiple options for purchasing a life insurance policy without going through a medical exam. Depending on your health and needs, some options could fit much better than others.

Simplified issue life insurance

Simplified issue life insurance doesn’t require a medical exam and includes a detailed health questionnaire instead. This can be an easier type of policy to qualify for if you have certain moderate health conditions, or if you’re over 50 years old.

A downside to keep in mind about simplified issue policies is that you get less coverage bang for your buck. Premiums tend to be higher than what you could typically expect from a term life insurance policy, and the coverage limits may be lower. In a 2020 report from the Society of Actuaries, most companies that participated in their research panel capped simplified issue life insurance at $250,000. Many term life policies can offer $1 million or more in coverage.

Guaranteed issue life insurance

Guaranteed issue life insurance takes an even more inclusive approach to applicants than simplified issue. As the name indicates, almost no one gets denied for a policy. Guaranteed issue policy applications often skip even the medical questionnaire, in addition to the medical exam.

When insurance providers know less about you, they typically protect their own risk by increasing prices and limiting coverage. That’s true for guaranteed issue life insurance. Most guaranteed issue policies set a maximum coverage amount of $25,000. Guaranteed issue life insurance is sometimes called “final expense insurance” because it’s most useful to help cover funeral costs and other final expenses. It’s not generally the best life insurance option to use for replacing the full financial contribution someone would’ve otherwise made for their family.

No-exam term life insurance

Term life insurance is one of the most cost-effective life insurance options out there. It offers lower premiums than other types of insurance and high coverage options, so you can use it to plan a financial cushion in case you or your partner pass away during your working years. It covers you if you were to pass away during a specific period of time, or term. Collecting medical information to assess your risk is one way term life insurance providers keep premium costs affordable.

In some cases, though, term life doesn’t have to involve a medical exam. No medical exam term life insurance isn’t its own type of insurance, but it uses an option called “accelerated underwriting” to approve certain applicants. This feature uses sophisticated algorithms and predictive models to crunch data and calculate risk quickly, so applicants who qualify can skip a human underwriting process altogether. 

You’re still applying for the same type of term life policy. The accelerated, no-exam option is a way to save time for healthy applicants so coverage kicks in as quickly as possible. And the cost of no-exam term life insurance is generally on par with "normal" term life.

Is Applying for Life Insurance With No Exam Worth it If I’m in Good Health?

Your health makes a big difference on your life insurance options. If you’re young and in excellent health, you can feel confident that you’ll get approved and you’ll probably qualify for rates on the low end of what the company offers. 

If the world of life insurance is your oyster, it wouldn’t make sense to choose a more expensive, more limited policy than you could get approved for. As a result, it’s likely better to stay away from simplified or guaranteed issue policies unless these are the only types of insurance available to you. These no-exam options are really designed for people whose age or health would be an issue for most term or whole life insurance policies.

That said, if you’re looking into accelerated underwriting for a term life policy, good health is not only worthwhile but essential. When insurance companies know you’re basically a shoo-in for a policy with great rates, there’s less need for a professional underwriter to comb through application details and weigh your risk. You’re still getting medical underwriting because they collect some health information from you, but you can enjoy a streamlined process. 

If an insurer can run your info through an algorithm, save you the medical exam and approve you faster for the same type of policy, it’s a win-win scenario. All told, the process of getting a no-exam life insurance policy is generally easier than getting a "regular" policy.

What if I get rejected for accelerated underwriting?

As you consider the pros and cons of no-exam life insurance, the one downside worth mentioning is what happens if you think you’ll qualify for accelerated underwriting but it doesn’t work out that way. You’ll need to answer some health questions to apply for no-exam term life insurance. It’s possible that you consider yourself to be in great health, but there’s some little detail in your response that stumps the algorithm. What happens next?

Companies like Fabric may still be able to approve you without an exam even if the accelerated underwriting algorithm doesn’t approve your application right away. You might need to answer additional questions or submit doctors’ records or prescription details. If that additional info still leaves the insurance company with questions, they may redirect you to go through a typical application process, meaning you’ll need to have a medical exam after all. 

If this happens, it doesn’t mean you’ll get rejected, but the extra communication can add time to the process. 

Ultimately, the big fork in the road is, is the type of insurance exam-free because they expect applicants to be in poor health, or in excellent health? In the former case, convenience now isn’t worth paying hundreds or thousands extra in premiums down the road. But if you’re in great health, taking advantage of no-medical exam term life insurance could mean a smoother application process to get the type of life insurance that fits your family’s needs best.

Fabric exists to help young families master their money. Our articles abide by strict editorial standards.

Information provided is general and educational in nature, is not financial advice, and all products or services discussed may not be offered by Fabric by Gerber Life  (“the Company”). The information is not intended to be, and should not be construed as, legal or tax advice. The Company does not provide legal or tax advice. Consult an attorney or tax advisor regarding your specific legal or tax situation. Laws of a specific state or laws relevant to a particular situation may affect the applicability, accuracy, or completeness of this information. Federal and state laws and regulations are complex and are subject to change. The Company makes no warranties with regard to the information or results obtained by its use. The Company disclaims any liability arising out of your use of, or reliance on, the information. The views and opinions of third-party content providers are solely those of the author and not Fabric by Gerber Life.