What Is No Medical Life Insurance In Canada?
With all the discussion about life insurance, many are struggling to understand the verbiage of “No Medical Life Insurance.” This is a particular type of life insurance that is available in Canada, and currently, the market is exploding. As more people realize that life insurance is for the living, there is a huge surge in people purchasing life insurance so that their loved ones aren’t left having to pay for their final expenses such as funeral costs and after death costs like probate fees, legal and accounting fees and outstanding debts.
No Medical life insurance means you do not have to undergo a medical exam and there are no doctor’s visits or blood tests required. You simply have to answer some health-related questions to qualify.
These plans are designed for those with serious health problems all the way to those who are in excellent health and just want a simple, fast way to buy life insurance.
No Medical life insurance policies fall into two separate categories. These categories are as follows:
Guaranteed Issue and Simplified Issue.
If you or your loved one is struggling to find an insurance policy due to health reasons or age, these may be for you. With the Guaranteed Issue policy, there are either no health questions to answer or only 1 or 2 questions. With Simplified Issue, you will answer anywhere from 2 up to 25 questions regarding your health.
No Medical policies are available as both term policies and permanent policies. With a term policy, the premium will start off low, and as you age and the term expires, the premium will go up when renewing the term as the premium is based on one’s age.
With a permanent policy, you will pay a slightly higher premium; however, this premium will never increase during the life of the policy.
The nice part about such policies is that there is an ideal plan for everyone, however, if the person has a medical condition in which they would be difficult to ensure, these policies will still give them coverage as there is no required medical exam.
Let’s examine these policies more closely:
In this type of No Medical policy, there are going to be some questions. However, there is no required medical exam.
The more questions that the policy requires, the lower the premium.
There is a maximum limit on the amount that can be insured on this type of policy.
That maximum limit can be as high as $500,000 depending on the particular policy.
Even if you have been denied a life insurance policy in the past, you can still qualify for a “deferred” policy. A deferred policy is one where the death benefit is deferred during the first two years the policy is in force. If death occurs during this period, the death benefit is limited to a return of premiums plus interest.
With this policy, you won’t have to have a medical exam.
Typically there are no health-related questions. At the most, there may be 1-2 questions.
You won’t be denied this policy even if you’ve been denied a life insurance policy in the previous two years. However, the policy may be a deferred policy.
Typically, the limit of the coverage for this policy is $25,000.
There may be some restrictions regarding payout during the first two years that the policy is in force.
Important Tips Regarding No Medical Insurance Policies
- Always choose an independent agent that understands why it may be difficult to get life insurance. This is especially important as the products and regulations are in constant flux. This means that you want an agent that is very familiar with such policies and how frequently the products and regulations change.
- These policies are very different than other life insurance policies so keep this in mind when you’re seeking out life insurance.
- Deferred policies will have a required 2-year waiting period. If your medical condition is very serious, this may not be enough for your needs.
- If you happen to die due to an accident, most of these policies will waive the 2-year wait period, and your beneficiary will receive the full amount of the benefits.
- Always ask the agent for a guaranteed premium. Some No Medical plans will not offer you a guaranteed premium. In these instances, the premium will increase after a specified number of years.
- There are many hidden “gems” in these policies if you know what to ask for. Ask your agent if there are any for the policy you’re considering. Such hidden gems include a height weight chart, and if you fall into the parameters, you may pay a lower premium.
- If you aren’t within the proper parameters of the height-weight chart, ask your agent what your options are. If you’re near the proper parameters, you may wish to lose a few pounds and then apply for your policy.
- There are still policies that will give you coverage if you fall outside of the parameters. You may, you’ll have to pay a higher premium so be sure to discuss this with your agent as well. Just remember, if you’re trying to pay the lowest possible premium, it’s best to stay within the height weight parameters.
- Typically speaking, the more questions that you’re willing to answer the lower the premium is going to be, especially if you answer the questions that they want to be answered as “NO.”
- If you’re not sure about a question, you can take the application to your physician and ask how to answer the specific question. In many cases, the physician can advise you on this information.
- Many serious medical conditions such as obesity, depression, heart disease, and diabetes can all still allow you to apply for a No Medical policy and get the policy into effect. Just keep in mind that if you qualify for a deferred policy, you must live past the 2-year mark for anyone to receive benefits unless you die an accidental death. Always discuss the pros and cons of your particular medical conditions with your agent before you sign on the dotted line. They may have other options that would better suit you.
- If you’ve been recently declined a life insurance policy, you may still qualify under one of these policies. Be sure to discuss this with your agent as well.
- Non-smokers always pay a lower premium for a life insurance policy.
- Always read the fine print. If you’re unsure of something, discuss this with your insurance agent prior to signing. It could make a huge difference in your premium and in your coverages. Always get the answer to your questions that you’re unsure of in writing in case you ever have to go back to the agent and change anything. This is also vital to your beneficiary so be sure to make copies.
- If you are willing to pay annually in lieu of monthly, you can reduce your premium. This is a great way to save money. Compare the differences with your agent to see what your savings may be.
- Always review the options carefully. If you’re declined for a policy, it could hamper your efforts to qualify for a different type of policy in the future. So again, talk everything over with your agent carefully and analyze the pros and cons of each type of policy before you fill out the application.
- Make sure that you’re most likely going to qualify before you apply to help ensure that you get what you need when you need it. If there is a chance of being declined, go with a different policy that you’re far less likely to be declined for. This could save you later if you wish to change policies. A knowledgeable agent will be able to guide you and find the best policy for your specific coverage needs at the best price.
- Always choose an agent. If you go directly through an insurance company, you’re limited to their brand or company, and you may miss out on some potential discounts that another insurance company may offer. Your agent is the person best designed to know which will provide you with the best coverage for your specific needs at the most affordable cost. They work for you and want to retain your business.
Now that you understand what you should be looking for in your No Medical Life Insurance policy in Canada, you are better prepared to apply for and get a great No Medical Life Insurance policy for your needs.
Remember, life insurance is for the living, you’ll want to ensure your family won’t have to worry about finances should something happen to you…….don’t increase their financial hardship. To do this, you’re going to require life insurance.
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