Seniors can have various reasons for wanting to obtain life insurance, such as offering some financial security for their loved ones or reducing the financial burden of final expenses. Although finding the right life insurance policy can be tricky for anyone, seniors often face additional obstacles due to their advanced age. For example, with all other factors being equal, such as policy type, health metrics and company, someone over the age of 50 is likely to pay up to 212% more than the premium of a 30-year-old. This inequality increases as the benefit level rises, making it difficult for seniors on a fixed income to afford the coverage they need.
This is also assuming that they’re approved for life insurance in the first place. Many policies require a medical exam to determine eligibility, leaving seniors who experience chronic health issues with fewer options. Since life insurance is an important aspect of end-of-life planning, policies that don’t require a medical exam offer a solution for those who would otherwise be left without coverage.
This guide explains the medical exam process for standard policies, which types of life insurance can be obtained without an exam and the benefits and consequences of choosing one of these policies.
What Is a Life Insurance Medical Exam?
Medical exams are required for many life insurance policies to provide the insurance company with a measurable risk assessment. Underlying and chronic health conditions can affect lifespan, so this assessment lets insurers know what they should charge to keep their incoming and outgoing funds on a scale that keeps the company profitable. Most companies have a proprietary classification system that ranks applicants based on the exam and their detailed medical history, although these classifications are similar across the industry.
This system determines how much the applicant will pay in premiums if insurance is issued. Those who present the lowest health risk will pay the lowest premiums. For some policies, applicants with poor exam results may not even be eligible for the insurance they’re seeking. These classifications can include:
- Preferred Plus: Exceptional health with a clean family history and good height and weight ratio.
- Preferred: Very good health but with a few minor conditions.
- Standard Plus: Good health with a good family history but poor height and weight ratio.
- Standard: Complex family history with poor height and weight ratio.
- Substandard: Complex family history and recent serious health complications.
What to Expect During the Exam
Life insurance medical exams are very similar to an annual physical. Before the physical examination takes place, a phone interview is usually conducted to gather general medical information. Questions will be asked about medical history, current prescriptions, lifestyle and social habits.
The physical portion typically takes between 15 and 45 minutes and is performed by a medical professional such as a nurse or a medical technician. The applicant may be given the option to have this performed at a medical facility, but the tests are simple enough that the examiner may schedule a time to come to their home. The associated cost is usually covered by the life insurance company.
The purpose of the exam is to let the life insurance company identify any high-risk conditions the applicant may have. These can include:
- The use of nicotine due to its connection with several serious health issues.
- Recreational drug use, which makes an applicant ineligible for most policies, except a few that make exceptions for marijuana use.
- High blood pressure, which can lead to problems with the heart, brain and kidneys.
- High cholesterol for its link to heart disease and stroke.
- Elevated blood sugar levels, which could be a sign of diabetes.
The applicant will likely need to fast for 8-12 hours before the exam to get accurate results on the blood screening. The exam will typically start with recording the height and weight of the individual. A blood pressure reading will be taken and blood and urine samples will be collected to submit to a lab for testing. In some cases, due to advanced age or high coverage requests, the examiner may perform an electrocardiogram (EKG). Males over age 50 could also be required to undergo a prostate-specific antigen (PSA) test.
Types of No Medical Exam Life Insurance
If a senior prefers to avoid the medical exam due to an assumption of poor findings or for personal reasons, there are some policies that can be issued without this step. These are term life insurance policies and will only pay out the benefit if the insured passes during the policy term, which is usually 10-30 years. The two most common life insurance types that don’t require a medical exam are simplified issue and guaranteed issue.
Simplified Issue Life Insurance
Simplified issue life insurance creates options for those with chronic health conditions who wouldn’t otherwise be able to obtain a policy. This policy type is also referred to as final expense insurance as the coverage amounts tend to be lower than with other life insurance options. In most cases, the applicant isn’t required to undergo a medical exam and minimal information is collected. As with other life insurance types, the company will ask detailed medical and lifestyle questions. In this case, however, the answers won’t be verified through a medical exam. The insurance company may also request to see the applicant’s medical records and gather additional information from sources such as:
- Medical Information Bureau (MIB): This nonprofit agency works with hundreds of insurance companies and shares information about previous life insurance applications and outcomes.
- Intelliscript: Maintains a history of drug prescriptions that were filled for the individual.
- Motor Vehicle Report (MVR): Shows driving history and alerts the insurance company to unsafe practices.
Due to the limited risk assessment required for simplified issue life insurance, policyholders will likely pay higher premiums. It’s also important to note that an applicant can be denied coverage if the information gathered appears to pose too great a financial risk to the company. Fortunately, those who are turned away may have another option.
Guaranteed Issue Life Insurance
Guaranteed issue life insurance is exactly what it sounds like. Every applicant is guaranteed coverage as long as premiums are paid on time. No medical exam is required for coverage and most companies only ask applicants a few simple medical questions, such as:
- Do you use tobacco products?
- Have you been diagnosed with a terminal illness?
- Do you have HIV/AIDS?
- Are you currently hospitalized or living in a long-term care facility?
The answers to these questions won’t make a senior ineligible for a policy, but they will determine the level of premiums charged. Guaranteed issue life insurance is known to be one of the highest-premium, lowest-coverage options, so this could affect affordability. These policy death benefits are also often graded. This means that if the insured dies during a set time period, usually a few years after the policy goes into effect, the beneficiary will only receive the amount that’s been paid into the policy. However, this type of policy can be a viable option for someone who wants to spare their loved ones the burden of final expenses.
Pros and Cons of No Medical Exam Life Insurance
When choosing a life insurance policy, a medical exam requirement can have a significant impact on the available options. It’s a good idea to determine whether a no medical exam life insurance policy is the better choice upfront, especially when previous applications can influence premiums. Here’s a quick comparison of policies that do and don’t require medical exams.
| Medical Exam | No Medical Exam |
| Pros | Higher coverage limitsLower premiums
| Rapid approval processEasier application processGuaranteed coverageCan sometimes be issued online |
| Cons | Longer approval processMore complex applicationCan be denied coverage
| Higher premiumsCoverage limits are generally lower except for those in peak healthUnderwriting may still be necessaryPossible graded benefits |
The final decision will depend on which policy options are available, the affordability and the reason why the life insurance is being purchased.
