Medically Underwritten Vs Non-Medical Plans: What’s the Difference?
If you have been wondering whether you can get insurance without the hassle of a medical exam, the answer is yes you can. Depending on your situation, a plan that does not need a medical examination for approval is a good idea.
Many of the insurance providers seek to determine whether an applicant has a medical history or pre-existing medical condition that is likely to alter the insurance rates or deny the applicant insurance.
However, there is a growing number of insurance carriers that do not require medical exams to base their insurance decisions. No medical exam life insurance plan are becoming common place, as more and more insurance shoppers opt for these types of plans. The difference between the traditional and non-medical plans includes:
The structures of the non-medical plans are different because a medical exam is not required. As a result, many of the insurance carriers offer less coverage, of up to $250,000.
Compared with the traditional plans that require a medical exam, the maximum face amount available may not be what you are hoping for. Nevertheless, shopping for the non-medical plan is advisable to get you a higher coverage.
Just like the traditional policies, the beneficiaries of the non-medical plan receive the benefits attributable once the policyholder dies, as long as the policy is still active.
Therefore, all premiums must be submitted as scheduled for the plan to remain active. Many of the providers offer a 30-day grace period, during which the premiums must be paid in. If you wait for too long, the policy can be cancelled and to get back on track, you will need to undergo a lengthy reinstatement process.
Most of the times, the insurance carriers release the funds without a problem, although the carrier has the right of conducting investigations if they suspect foul play.
The price is a major difference between the traditional plans and the non-medical plans. A medical exam allows the insurance provider to gather a lot of important information about you.
Therefore, the carrier is able to fully assess the risk you pose and your insurability. As a result, the premiums you can expect to pay will be based on facts and more likely to be lower.
On the other hand, non-medical plans cost higher because the carrier seeks to factor in the risk of not knowing the health status of the applicant. However, if you shop around you will discover insurance carriers who specialize in no medical exam life insurance, while offering their plans at competitive rates.
Furthermore, the growing number of insurance providers offering these types of plans has contributed significantly in bringing down the prices of non-medical plans.