No Physical Life Insurance
In the past, life insurance companies would require a short physical exam before underwriting a policy. The physical exam would include drawing blood, collecting a urine sample, height, weight, blood pressure etc. These figures would then be analyzed and sent back to the life insurance company and they would give you a rate based on the results. If your results came back favorable then you would receive favorable premium rates. If your results came back less than favorable then the insurance carrier would rate you based on their risk table and it’s likely your premium rates would be higher. At that point, you can either afford the policy or you can’t afford the policy. If you can’t afford the premiums then you lower the coverage or face amount to lower the premiums. If you absolutely have to have a certain coverage amount to cover a mortgage or college tuition then your stuck with a premium that is too high.
One solution that has become more popular in recent years is a “No Physical Life Insurance Plan” or a “Non-Medical Exam Life Insurance Policy”. As stated, these life insurance plans are underwritten based on your answers to certain questions as opposed to blood and urine tests. These policies are becoming more popular due to the convenience and speed of policy issuance. Most people would prefer not to have someone come to their home and draw blood and collect urine if possible. There is also a lag time from when your application is completed and the life insurance carrier underwrites the policy. The lag time is due to the medical exam which has to be scheduled then the specimens need to go to a lab where results can be recorded and sent to the life insurance company. Sometimes this process can take 1-2 months before the life insurance company underwrites and sends you an accurate premium.
With no physical life insurance, you make the purchase online or over the phone and the policy is in force almost immediately. There is no one coming to your home to collect blood and urine and there is you’ll know your exact rate almost immediately.
You can get a lot of coverage, up to $500,000 and often times the premiums are not much higher than a standard term life insurance policy. Getting an instant no physical life insurance policy makes a lot of sense for a lot of people. If your young and in good shape you may be looking at an additional dollar or so a month. Wouldn’t you rather pay an additional $1 per month to get instant coverage and not have someone come to your home and poke you with a needle and ask for a urine sample? Of course each person’s circumstances are different and in some instances this is not the best solution.