What is no-exam life insurance and how does it work?

Please note that this article is meant to educate and clarify some of the terms used by life insurance companies. Only existing Nationwide® Property & Casualty insurance members can currently purchase a simplified whole life policy without a medical exam. However, Nationwide's underwriting process also allows qualified healthy applicants to bypass a medical exam on all other life insurance policies.

Life can be complicated. So when you find a way to simplify the complex — especially for something as important as buying life insurance — it’s only natural to be curious.

Many companies today offer no-exam life insurance as a fast and noninvasive way to get the protection you need. Like most things in life, though, there can be benefits and limits that you need to consider before choosing a product.

What is no-exam life insurance?

Traditional life insurance requires a medical exam to help give the insurance company a better picture of your health. This process includes collecting data such as:

• Height
• Weight
• Blood pressure
• Blood and urine samples
• Possibly an EKG

As the name implies, no-exam life insurance can issue a policy to you without needing to go through this process, drastically reducing what can sometimes be a lengthy ordeal.

How does it work?

Three types¹ of no-exam life insurance are available, each with their own unique benefits and limits.

Accelerated underwriting policies

Companies that offer these products use the data you provide, as well as third-party data and algorithms, to decide if they should offer you coverage or not. They offer the convenience of not having to complete an exam while still providing rates similar to products requiring full underwriting. However, they usually also have coverage limits (often $1 million) that can make this choice less appealing if you need more protection.

Simplified issue life insurance

For this type of product, there are typically fewer questions to answer and fewer resources used to collect your data. But because the company has less information to go on, you’ll likely end up paying more for your insurance. These products also have coverage limits that you’ll need to be aware of prior to applying.

Guaranteed issue life insurance

With this type of product, you’re guaranteed coverage, as the name suggests. There is no exam and there are no questions to answer, with age generally being the only restriction. These policies offer very limited coverage (typically about $25,000) and will cost much more than traditional life insurance. They are most often used by older people (or those in poor health) as a way to help their loved ones pay for final expenses.

Is no-exam life insurance right for you?

As more and more companies offer coverage (especially term life) with no medical exam, you gain more control over how long the process will take and how invasive it’ll be. While each type of no-exam life insurance has its benefits, they also have limits to consider.

It’s also important to remember that traditional life insurance can often offer you a lower rate because it’s based on your unique health and lifestyle. And most companies, including Nationwide, have simplified the medical exam and underwriting process to make them as painless as possible.

Knowing how much coverage you need, how much you want to pay and how long you’re willing to wait for coverage will help you choose the best type of life insurance product to meet your needs.