No Medical Life Insurance: Understanding the Two-Year Waiting Period

The two life insurance
issuing categories.
Photo by Chelsea Oakes

No medical life insurance policies are always broken down into the following two categories:

1. Guaranteed-issue Life Insurance, which has no health questions and no medical tests. BMO Insurance is a leading provider of Guaranteed Issue plans – selling its flagship plan, Guaranteed Life Plus, directly via its call centre. The only carrier to offer Guaranteed Issue coverage via independent brokers is The Edge underwritten by Industrial Alliance.

2. Simplified-issue Life Insurance has three to 12 health questions and no medical tests. The primary carriers in this category are Assumption Life, Canada Protection Plan and Industrial Alliance.

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Virtually all guaranteed issue policies have a two-year waiting period. If the insured dies by a non-accidental death in the first two policy years, the death benefit is limited to a return-of-premium plus interest.

Simplified-issue policies can come with or without a two-year waiting period. As a rule of thumb, if the insured's health is in decline in the last two years, the simplified issue policy will have that waiting period. Additionally, simplified issue policies pay out an immediate death benefit, but they tend to have a higher amount of health questions.

For more details on non-medical life insurance in Canada, you can contact us at 1-866-899-4849 or visit our Non-medical Life Insurance Quote Page.

Posted by Chantal Marr.

Chantal Marr is a member of the Independent Financial Brokers of Canada.
Much of her success stems from her ability to listen to her clients' needs.
Read Chantal's background.

6 Comments

Jeff 04/30/2013 at 9:12 pm

What is the expected timeline for disbursing the allotted insurance amount to the “heirs” of my policy , in the event of a sudden death? Thanks, Jeff
LSM Insurance 05/01/2013 at 12:03 pm

Hi Jeff,

The time it takes to pay out a claim often depends on 1) how long ago the policy was issued – if under 2 years iyt will generally take longer 2) the size of the policy -larger policies often take longer to settle and 3) the cause of death if the insurance company suspects any type of fraud in terms of the initial application this will slow the claim process. A good broker keeping in contact with the claimant and insurance company can speed up the process significantly.
Macius 05/04/2013 at 11:52 pm

Do all No Medical Plans have a waiting period and is it always two years.

LSM Insurance 05/05/2013 at 1:47 pm

Thanks for the note Macius. No some no medical plans offer coverage from day one.

Plans that coverage from day one usually require that insured has not been declined in the last 2 years and do have more questions than plans with a 2 year waiting period.
Kirk 05/12/2013 at 6:36 pm

Are they any companies with a waiting but shorter than 2 years this eems kind of long
LSM Insurance 05/13/2013 at 8:23 am

Hi Kirk,

Most insurance companies with a deferred death benefit have it set at 2 years. Bingham Group Services have a Guaranteed Issue Mortgage Insurance plan with a lifetime exclusion but only conditions treated in the last year. So this is a bit of twist. It also covers mortgages up to $500,000.

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No Medical Life Insurance: Understanding the Two-Year Waiting Period

The two life insurance issuing categories. Photo by Chelsea Oakes

6 Comments

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The two life insurance
issuing categories.
Photo by Chelsea Oakes