Simplified Issue Life Insurance: How Does BMO Insurance Compare to Assumption Life?

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Moody by Andy Rennie
It shouldn't be hard to decide between
BMO and Assumption Life no-medical plans.
Photo by Andy Rennie

The no-medical life insurance market seems to be an increasingly reactive niche market when it comes to direct life insurance carriers in Canada. Consumers have their choice to buy direct or use a broker.

The insurance companies know that too. Two carriers butting heads in this market are BMO Insurance and Assumption Life. BMO Insurance offers two types of no-medical life insurance, their Guaranteed Life Plus plan, which has no medical tests and no health questions, and their Easy One simplified issue policy, which has no medical tests and a health declaration question.

Assumption Life does not offer a guaranteed issue plan, but it does offer several versions of simplified issue coverage. Its flagship simplified issue plan is called Golden Protection

Let's take a look at how these products stack up against each other:

BMO Easy One

  • Sold direct by BMO and not available through brokers
  • Face amounts up to $25,000
  • Coverage from day one
  • Available to applicants age 50 to 80

 A 61-year-old, male non-smoker with $25,000 in coverage would pay $112.25 per month.

Assumption Life Golden Protection

  • Sold via the company's independent broker network
  • Face amounts of up to $50,000 in coverage
  • Coverage available on an immediate basis or a deferred basis
  • Available to applicants age 40 to 85

A 61-year-old, male non-smoker with $25,000 in coverage costs $110.18 per month.

You might assume we have a bias towards the Assumption Life plan. Since this is a broker-based site, and we admit you're probably right. But consider this: the Assumption Life policy is truly more affordable at many ages, has higher face amounts, and in many instances is easier to qualify for. Plus, with one health question, the qualifying procedure is less stringent. For example, there's no blood pressure–related question.

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One final note: we feel there is significant value in dealing with a broker. A well-trained independent broker can look at a variety of carriers to see which one provides the best value. He or she can look into traditional life insurance plans to see if this is an actual option for you. They can also provide ongoing assistance with your insurance needs and help you out at the time of claim.

14 Comments

  1. Ami Maishlish 07/15/2013 at 11:14 am

    I am becoming more concerned over the language used for the questions in application forms for the so called “simplified issue” offerings. In some instances, the way the questions are wprded involves mental/psychological interpretation that, IMO, are akin to the text equivalent to a Rorschach inkblot. My suggestion to anyone considering the sale of these product, and more so to anyone considering the purchase of these products are:
    a. READ the questions on the application form. If the question is unclear, get a WRITTEN explanation from the insurer or at the very least from the Managing General Agent.
    b. REQUEST and READ the contract and the way it is worded. There are vast differences in the language among these contracts. Again, as with the application questionnaire, if anything is unclear, get a written explanation/elaboration from the insurer or at the very least from the MGA, but GET IT IN WRITING.
    c. In many cases there are better options than these so called “simplified issue” offerings and these are worthy of consideration before even thinking of grasping at the last straw – the so called “simplified” and “guaranteed” issue offerings.

    I would also add that life insurance planning – an integral part of any personal financial plan – should start before the perceived need to explore “simplified” or “guaranteed” issue offerings arise. If your insurance agent makes a blanket suggestion that in general people need no life insurance or less life insurance upon retirement, send him or her away as expeditiously as possible and find someone who knows more about life insurance and sound financial planning than what the sales commission rates and bonuses are.

    Oh, one more thing to keep in mind: Insurance companies WANT to show as many of their competitive products on LifeGuide, and inclusion of any product offering on LifeGuide doesn’t cost the insurer anything. Hence LifeGuide includes well 2,000 + products and product variations from significantly the largest number of insurers. However, when an insurer knows that their product is likely uncompetitive and will not fare well when compared with the competition by a caring and objective professional, they will shy away from having the product included and will opt for other marketing options, incl. high sales commissions and sales bonuses and direct marketing through TV commercials, web sites, “free” incentive offerings and the like. Bottom line, IMO, and based on nearly 40 years of experience with the industry: “If it’s any form of life insurance, CI insurance or LTC insurance and it ain’t on LifeGuide, it’s likely uncompetitive”.

  2. LSM Insurance 07/15/2013 at 11:24 am

    Get something in writing and / or clarification becomes increasingly difficult with Simplified Issue plans sold direct via insurance carriers as there is really no one to speak to other than a call centre. The marketing of direct simplified issue plans has really increased in recent years.

  3. Ami Maishlish 07/15/2013 at 11:28 am

    If you can’t get an explanation or clarification in writing, consider that to be a big “Do Not Enter” sign. Remember, you are buying the insurance so that your beneficiary should be receiving an insurance benefit, not an insurance headache. If you want to will your beneficiary a headache, buy him/her a CD with “heavy metal” music; it’s cheaper.

  4. LSM Insurance 07/15/2013 at 11:35 am

    Agreed. I think this is the message that brokers and hopefully the media have to get out there. As many insurance carriers are really making a strong push and investing big dollars in marketing their direct lines.

  5. William Shung 07/15/2013 at 1:20 pm

    The BMO Easy One plan with maximum coverage of $25,000 is really only good to cover final expenses. The Assumption Golden Protection plan with maximum coverage of $50,000 is better. Nevertheless, I have come across many individuals with health problems who require much larger coverage. Roughly 4% of life insurance applications in Canada are declined each year. This represents an estimated 32,000 applications, and $8 billion face amount. 80% of these declines are due to medical or lifestyle history. Readers who belong to this category should know that this is not the end of the road. You can get life insurance up to $500,000 and Disability insurance up to $10,000 a month. If you need coverage, want coverage and can afford coverage, speak to an experienced life and disability insurance professional who can get you the coverage you cannot source through your regular market suppliers.

  6. Ami Maishlish 07/15/2013 at 1:55 pm

    Hmmm… it’s rather doubtful that the media will get the message out, at least not the commercial media, and for a very simple reason: Commercial media derives the bulk of its revenue from advertisers… “those who pay the piper call the tune”. So, that leaves the task of lobbying for clear text, open disclosure, and urging consumers to be more aware to those brokers and financial advisors who place their clients’ best interests first.

  7. LSM Insurance 07/15/2013 at 2:06 pm

    Articles like the one below link to thestar.com while an older article show that some main stream media are willing to take on the big brands

  1. LSM Insurance 07/15/2013 at 2:07 pm

    Good points Willia,. Assumption also has The Golden Protection Plus with an increasing death benefit to keep in line with inflation

  2. Ami Maishlish 07/15/2013 at 6:00 pm

    Yes, I could vaguely recall that piece by Roseman in the Toronto Star Not much of any investigative reporting in that 2007 article; essentially a parroting of bits and pieces of material published elsewhere. I was much more impressed with the quality of material written by James Dawe, CFP who used to do much more thorough investigative reporting before his journalistic freedom to do that was muzzled by the editors at the Star

  3. LSM Insurance 07/15/2013 at 6:03 pm

    The CBC also did a documentary that attacked the banks link to cbc.ca

  4. Ami Maishlish 07/16/2013 at 9:43 am

    Yes, the CBC did the piece on Certificate Group Creditor insurance in which deficiencies in the manner in which that type of group insurance is sold were explored. That CBC piece was well researched and far better than the 2007 Roseman regurgitation in The Star of elsewhere pre-published points about Certificate Group Creditor Insurance. True, the CBC piece did refer to an insurance company, but that insurance company doesn’t advertise much on the CBC.

    Both of your citations – the 2007 Roseman parroting in the Star of bits and pieces of material publishes elsewhere and the CBC piece – dealt with Certificate Group Creditor insurance, and not the so called “simplified” or “guaranteed” issue individual (non-group) policy offerings. The media doesn’t get much (if any) ads promoting Certificate Group Creditor Insurance but does enjoy nice revenue from TV ads etc. to promote the so called “simplified” and “guaranteed” issue insurance, so my point that the commercial media will shy away from investigative reporting on these remains. Can you come up with an example of investigative reporting by commercial media on the so called “simplified” and “guaranteed” issue offerings by any of the big advertisers?

  5. LSM Insurance 07/16/2013 at 9:46 am

    Hi Ami, None off the top of my head. We have wrote several articles on this sitewww.lsminsurance.ca and http://www.nomedicallifeinsurance.ca but our reach while increasing only extends so far.

  6. G. G. Maxim D'Mello 07/16/2013 at 9:49 am

    Excellent comparison with value added benefit of dealing with your qualified broker or insurance agent.

  7. LSM Insurance 07/16/2013 at 9:59 am

    Thanks Maxim. I’m glad you found the info useful.

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