Purchasing Life Insurance After Loss
Coping with the loss of a loved one is difficult, but taking the right steps for yourself can ensure it’s less stressful
The loss of a loved one is a difficult time, but it also serves as a reminder to make sure you have financial protection in place for your family when you pass away. One important way to ensure protection is through purchasing life insurance. Typically, life insurance policies require a medical exam, but some insurers offer no medical exam life insurance usually called accelerated term life insurance. There are many advantages and disadvantages to purchasing life insurance this way, so let’s go over their similarities and differences in order to help you find the right coverage.
Why No Exam Insurance Policies Cost More
Life insurance without a medical exam is a hassle-free way to get coverage, but more of a financial commitment
If you’re someone elder in age, you may be thinking about the financial security of your family after you pass sooner than others. In that case, the advantages of purchasing life insurance without a medical exam may be very beneficial.There’s no waiting period, simple application process and easier qualifications to meet. It can help you get coverage that you otherwise may not be able to obtain because of pre-existing health conditions for example. However, it’s difficult for an insurance company to fully evaluate your lifestyle without health information which then determines the risk they take on by offering insurance. The higher the risk, the higher the premium, compared to term life insurance.
Types Of No Medical Exam Life Insurance
See what differentiates each from one another
Simplified issue life insurance: This policy is best if you are young and in good health, but want life insurance without the waiting period. As long as you provide some basic health information, you can apply without a medical exam. The disadvantage with this policy is your premium will be more expensive compared to term life insurance. Another disadvantage is most simplified policies cap out around $300,00 compared to traditional term life policies which can offer up to $1.5 million or even more in coverage. This coverage limit is something to keep in mind for those with kids and a mortgage.
Guaranteed issue life insurance: This policy is best if you have major health issues and need coverage for final expenses. Serious health issues often cause for rejected applications due to high risk for the insurance companies, so guaranteed issue life insurance can be a way to get coverage without bringing your health into concern. The main disadvantage here is that your coverage will be significantly expensive and limited.
Employer-sponsored life insurance: This policy is only applicable for those who have access to life insurance through their workplace. The main advantage with this policy is that it will be highly affordable or free. Something to keep in mind is that your coverage will be typically close to your annual salary, which may not be enough to cover your family’s financial needs. While not as limited as guaranteed issue life insurance, this policy may only stay active while you are employed by the employer.
How To Apply For Accelerated Life Insurance
Let’s walk through the steps in recieving coverage
Not all insurance providers offer accelerated underwriting, but if this option is available to you, here’s what you can expect. First, you will submit detailed information about your health, financial and lifestyle information which will then be assessed by algorithms. If your health and credit standing are in good shape, the provider may be able to approve your application immediately. If the algorithm is unable to make an offer, you can expect follow-up questions from your provider. Keep in mind, not everyone will qualify, so considering your family health history may be important before applying as it can highly impact your eligibility.
Planning for your family’s future after you pass can be overwhelming, but we hope this article helped you understand several life insurance policy options to make the process quicker and easier.