Did you know that if you are a Canadian, you can get life insurance without getting a medical examination? Yes, it is possible. Known as “No Medical Life Insurance,” this policy allows you to get medical insurance without the routine medical tests that are mandatory for traditional policies. You can find more here about this insurance.
Most life insurance providers in Canada offer three types of no medical insurance policies:
- Accelerated issue life insurance
- Guaranteed issue life insurance
- Simplified issue life insurance
Let’s unpack the details for each type of insurance.
Accelerated issue life insurance
Don’t have the time to invest in life insurance, or don’t want to pay extra for faster approval? Accelerated life insurance is your best bet in these circumstances. This instant-approval life insurance comes with a catch- you have to be in the pink of health. If not, you may have to take a medical examination to get the approval.
The premium rates for accelerated underwriting policies are determined by sophisticated algorithms that calculate your risk of insuring you. In order to apply, you must answer some health questions. Your life insurance provider will assess the information before approving the insurance. You may be asked to undergo medical tests if your information does not fulfill the requirements.
Guaranteed issue life insurance
The term “guaranteed” implies that you receive coverage regardless of your medical history. You may avoid answering medical questions or undergo medical tests. Therefore, it is very similar to no medical life insurance. Moreover, guaranteed life insurance is ideal for seniors and those with health issues. The age range for this insurance type is 40 and 85.
The downside of guaranteed insurance:
- More expensive than permanent life insurance and simplified issue life insurance.
- Includes a waiting period of two years. Your family will receive a refund for the premiums you paid into the policy if you die within this period.
- Limited coverage amount, which is usually just enough to cover funeral expenses. That’s why it is also known as burial insurance or funeral expense life insurance.
- Does not include a savings component, unlike standard whole life insurance policies.
Simplified issue life insurance
Just like permanent life insurance, simplified insurance offers lifetime protection. However, it does not accumulate cash value and offers only basic coverage. Likewise, there are other restrictions with this type of insurance because it:
- Doesn’t require a medical examination
- Requires answers for medical questions to qualify.
- Doesn’t guarantee approval for everyone who qualifies.
- Offers high premium rates and low benefit amounts.
In some simplified issue policies, there is a two-year waiting period. After the waiting period, the proceeds of the policy become available to your family. The insurer will not issue the payout if you die within the first two years. Instead, it will pay your family the amount you paid in premiums.
This type of policy may be appropriate if you are otherwise in good health but do not qualify for traditional life insurance or permanent life insurance.