No medical life insurance is a unique type of life insurance that does not require a medical exam during the underwriting process. This appeals to individuals who are unable to obtain traditional coverage due to serious health conditions, dangerous occupations or other factors that deem them, high-risk individuals. No medical life insurance tends to be on the more pricey side and does not offer as much coverage for the price, however, it does allow those in dire circumstances some coverage in the event of their passing.
What is no medical life insurance?
No medical life insurance is a unique type of life insurance that does not require you to undergo a medical exam or doctor’s visit during the underwriting process. This type of policy appeals to those who are denied traditional coverage due to medical conditions, mental illnesses, criminal records, dangerous occupations or many other factors. These factors cause these individuals to be classified as high-risk and result in less than ideal ratings from life insurance companies.
No medical life insurance policies provide individuals in these difficult situations the opportunity to obtain coverage. However, this coverage does tend to come at a higher cost and lower coverage amounts. These types of policies are not the most cost-efficient but do offer peace of mind to those who would otherwise not qualify for any life insurance coverage.
Types of no medical life insurance
No-medical life insurance appeals to those who do not qualify for either of the two types of traditional life insurance: term life insurance or permanent life insurance. It is designed for those who face difficulties trying to find a life insurance company to insure them.
Just like how there are two main types of traditional life insurance, there are also two main types of no-medical life insurance: simplified issue life insurance and guaranteed issue life insurance.
Simplified Issue Life Insurance
Simplified issue life insurance does not have a physical examination, however, you will still be required to answer a number of questions regarding your medical history and health condition. This type of life insurance is meant for those who are aiming for a fast approval process and a short underwriting period. In some cases, you can be insured within a couple of days as opposed to weeks or months. Simplified life insurance can be offered as either a term or permanent policy depending on the life insurance company.
This type of life insurance is best for individuals who do not wish to undergo a medical exam, are not sure what type of policy they can qualify for, or even simply because they need life insurance quickly.
Guaranteed Issue Life Insurance
Guaranteed issue life insurance does not have a physical examination, nor a questionnaire regarding your health and medical history. Just like the name suggests, your coverage is guaranteed. Like simplified life insurance, this coverage can also be very quick and you won’t have to wait a long period of time or worry about not being accepted in the first place. Unfortunately, this comes at the cost of higher premiums and lower coverage. This is due to the high risk associated with insuring those that are seeking it. It may also take longer to obtain the payout money.
This type of life insurance is best for those that don’t qualify for anything else, or those seeking to provide their family with at least a little bit of a death benefit payout.
Pros and cons of no medical life insurance
Advantages of no-medical life insurance include:
Provides coverage for dangerous activities and occupations
Provides coverage for foreign travel
Disregards past substance abuse and/or criminal history
Less tedious application process
Disadvantages of no medical life insurance include:
Limited coverage options and benefits
Policies are shorter in length
Who is no medical life insurance best for?
You do not need to go through a medical exam to obtain coverage from no-medical life insurance policies. However, it still has requirements that need to be met. This means that no-medical life insurance is best for individuals in situations such as:
- You have been declined for life insurance
- You have a serious health issue
- You have a dangerous lifestyle
- You have a dangerous job
- You do not want to go through medical exams
- You do not mind a smaller death benefit
- You need to get coverage within a short period of time
- You are not a fan of taking exams
What is underwriting capacity?
Underwriting is the process of analyzing and obtaining information on a life insurance applicant in order to classify them according to the risk to insure them. The underwriting process determines the cost of your premiums for the amount of coverage you are seeking.
The underwriting capacity is the maximum amount of liability that a life insurance company agrees to take on based on the results of the underwriting process. The underwriting capacity represents the life insurance company’s ability to retain risk. In other words, it is the maximum amount of coverage a life insurance company is willing to offer you. It is important for a life insurance company to calculate and maintain its underwriting capacity so it can ensure it is able to meet payout claims when necessary.
What is no medical underwriting capacity?
No medical underwriting is the same as a traditional life insurance underwriting process but without the consideration of a physical medical exam. In some cases, it disregards the health and medical history entirely.
No medical underwriting capacity is the maximum amount of liability a life insurance company is willing to take on based on the results of their no medical underwriting process. These coverage limits tend to be lower than the traditional life insurance policies due to the higher risk associated with insuring individuals without considering their health and medical history.
What are no medical life insurance coverage limits?
How much coverage a life insurance company is willing to undertake differs depending on the company itself and the age of the applicant. Here are some of the maximum coverage limits of the best life insurance companies in Canada.
If you fall into the age ranges with the specified company, you won’t be required a medical by the insurance company up to the certain amount. For example, if you are 52 and apply for 1M coverage with Manulife, you won’t be required any fluids.
up to $5,000,000:
- Manulife, 18-50
- Canada Life, 18-45
- Sun Life, 18-40
Up to $1,000,000
- Assumption Life, 18-45
- Beneva (Formerly SSQ), 18-50
- BMO, 18-50
- Canada Life, 18-60
- Empire Life, 18-50
- Equitable Life, 18-50
- Humania, 18-45
- Industrial Alliance, 18-50
- ivari, 18-50
- Manulife, 51-60
- RBC, 18-50
- Sun Life, 18-50
- Wawanesa, 18-50
How much does no medical life insurance cost?
The cost of no-medical life insurance will vary based on the life insurance company you choose. However, do not be alarmed by the higher premiums associated with no-medical life insurance policies.
Below we have formulated the cost of SSQ Simplified Insurance for different ages, gender and smoking habits.