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Non-Medical Life Insurance: Simplified Issue versus Guaranteed Issue
careful before you sign
photo by Christian Birmele
One of the small annoyances that comes with buying a traditional life insurance policy is the required medical form you must fill out, especially since some people cannot qualify for those types of plans, but still want to ensure their family's financial future. Well, don't worry because there are plans out there that require no medical exam called Simplified Issue Policies and Guaranteed Issue Policies, but there are a few subtle differences between these two distinct plans, which you should be aware of before you buy.
Simplified Issue Life Insurance Policies
These are policies available without a medical exam, but they still have a host of health-related questions. You should also keep in mind that the face amount on these policies is often limited to $150,000 of coverage because it's necessary for a life insurance company to set a maximum to cover potential losses.The chance of an insurance company receiving a claim for a life insurance policy that requires no medical exam is much greater than from a traditional policy.
Under traditional insurance plans, you complete a regular medical exam and (If you're in very good health and your family has a very good medical history) you can be approved at preferred rates or standard rates. If you are deemed to have a health risk, you will be rated (charged extra) and, in those cases where your health risk is deemed too severe to qualify for the policy, declined.
Simplified plans give you the convenience and reduced hassle of being able to get coverage in a few days, without going through a medical exam.
Most simplified issue plans are not available if the insured has been declined in the last 2 years. As a rule of thumb, the more health questions on a simplified issue application, the lower the premium.
Guaranteed Issue Life Insurance Policies
These plans provide immediate insurance with No Health Questions, No Medical Exam and No Underwriting. They are available even if you have been declined in the last two years.
Most guaranteed-issue life insurance policies are designed to provide for final expenses. The face amount is often limited to $25,000 and the death benefit is generally limited to a return (including interest) if the insured dies in the first two years of the policy. However, if they die by accident, the plan pays out immediately.
You can find more information at our Non-Medical Life Insurance Page or feel free to contact me at 1.866.899.4849
Direct line: 905.248.4849 Email:
I had bypass surgery 5 years ago and am 63. What would the rate be for 50,000 coverage
Hi Larry,
Thanks for the note. I’m happy to help out and will send you an email shortly. Regards … Lorne
My spouse, Joan and I have taken out policies with Manulife Non-Medical Life Insurance. Withdrawals for 133.73 and 152.83 respectively were deducted this month, February 2010. We have not yet received our policies. In fact, I called your office earlier today and spoke to a gentleman who told me that the policies will be mailed this week. While I was on line, I read that these policies do not pay if either my spouse or I die within the first two years. We were not told this. Without a written policy we have had deductions without knowing all the details. Are there other details of which we should know? For example, my spouse has diabetes. Are there specific caveats attached to her? Or is the same two year caveat all that applies? In addition, I had applied sometime in the past for insurance and was turned down. It was several years ago. Would you have access to my file to ensure that I will not be paying into a policy that might be invalidated when needed. Finally, would these policies become invalid after we reach a certain age, or does coverage continue, regardless?
Thanks.
LF
Thanks for the note. You would have to contact Manulife directly for any specifc questions or concerns on your policy. We would be happy to help out with a comparison quote 1.866.899.4849