No Physical Life Insurance

Life insurance coverage invariably involves underwriting. Often time this underwriting involves a physical. But what if one is unable to pass a physical? While such a situation does limit options, it is nonetheless still possible to find adequate coverage.

The first thing one should do is review their current life insurance. If they have adequate coverage but are unable to get any more through their current company by a guaranteed insurability rider or by other means, it stands to reason that keeping their current policies in forces becomes paramount. Even if that’s the case, it’s no reason to give up. The life insurance industry wants to be able to sell to as many policies as possible; therefore very few people are truly uninsurable.

Even if one is unable to purchase large amounts of life insurance due to health concerns, a certain amount of life insurance is still needed for final expenses which everyone will eventually encounter. A funeral can easily cost over $10,000, and just about everyone will pass probate costs on to their estates. While the costs are quite modest in comparison to the seven times of income that many insurance professionals recommend, they are still there. No physical life insurance plans can fill this need.

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If a physical is not an option, it is not always necessary to assume that a high-risk or otherwise restrictive plan are the only options. As matter of company policy many life insurance carriers don’t require a physical in the first place on all their regular products provided the policy is a small face value, usually $100,000 or less.

Some companies will offer a no physical life insurance program for up to a $500,000 face value. These companies usually market and operate online. While chances are they are perfectly legitimate, it is always a good idea to check with the state insurance commission and with A. M. Best to determine if there are any licensing, regulatory or financial strength issues before buying anything.

This option is usually available to individuals under 40. After age 40 many companies tighten their requirements for a physical significantly. Of course, the older one is, the more the premium will be.

Some companies also offer looser no-physical underwriting requirements for a limited time at a certain time of the year. These events, known as “underwriting fairs,” are designed to help agents increase their life insurance sales, but can be quite beneficial for consumers who would have difficulty passing a physical. While there are restrictions, it can be a good option to consider if available. Ask an insurance professional for more information.

Guaranteed Insurability Rider

If one finds they need more life insurance, but unable to pass a physical. It is always a good idea to check with an agent to see if an existing life insurance policy has a guaranteed insurability rider. The guaranteed insurability rider allows the insured to purchase more life insurance without any physical, indeed without any underwriting at all.

The down side is that one first needs to have a life insurance policy in force, and had to have selected the guaranteed insurability rider when that policy was written, to take advantage of it. Because chances for insurability are inevitably likely to diminish as one grows older, the guaranteed insurability rider should always be considered when made available.

No Physical Life Insurance for Children

Many companies do not require physicals for life insurance on infants and small children. Some companies, such as Gerber Life, specialize in these policies. Due to infant mortality considerations most companies won’t insure a baby less than 14 days old, but after that underwriting is usually a snap. The Gerber policy offers guaranteed insurability riders and increased face values at certain ages. However, they are by no means the only game in town when it comes to insuring children.

Most companies won’t cover a minor on a term life insurance plan, but whole life policies for children are often quite reasonable, even at a single-pay premium. Even if premiums dry up, one can declare the policy paid in full by implementing the “reduced paid up” option. While this lowers the face value on the policy, it also gives the child a paid in full permanent life insurance policy he or she will have for life.

No Physical Life Insurance for Seniors

Life insurance for seniors is a specialized field. As such many of the companies that offer specialize in it. Several of these companies will offer short term life insurance programs on a no physical basis. These terms may be as short as five years, but available to people age 75 or even older.

Modified whole life insurance is another insurance program offered without a physical. While it has many of the features a traditional whole life policy has, it also often provides a death benefit lower than the face value. Generally speaking the lower death benefit is payable if the insured dies within two years of policy issuance, or the cause of death is a pre-existing condition.

These policies are geared towards individuals between the ages of 50 and 80, and are often advertised by companies such as Colonial Penn. Modified whole life insurance policies usually have modest face values and are best utilized as strictly a policy for final expenses.

While these policies may be worthwhile, it is especially important to do the homework on any company specializing on life insurance for seniors, as this is considerably more susceptible to fraud and other unethical or illegal practices than most other subfields of life insurance.

High-Risk Life Insurance

Several companies specialize in high-risk life insurance policies with minimal underwriting, but also with minimal benefits. Many of the applications have fewer than five health questions, and will issue a policy provided the insured does not have a terminal condition such as cancer. These policies may work well for people suffering from extreme obesity, as weight-to-height ratio is one of the most important considerations in mainstream life insurance underwriting.

However, the death benefit offered on a high-risk insurance policy is often quite small, and the premiums are quite high. High-risk plans are generally seen as a last resort for people who are otherwise completely uninsurable.

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