Do all Life Insurance Companies Require a Physical Exam

Life insurance companies do not always require a physical exam. Let’s look at the options.

1. No exam, no tests- These are called “Guaranteed Issue” policies and often are purchased by people uninsurable by any other means. In almost every case the face amount is limited (typically 25-35k) and the policy does not pay a claim except for a return of premium in the first two years. Also, the premium is expensive in the long haul relative to the death benefit. Most of these policies the total premium over more than 8-10 years will exceed the face value. This is why most of them are cash value policies- the death benefit at that point will begin to grow with the total premium paid into them. They are a good deal if you die in the third to 7th or 8th year, but unless you are completely uninsurable for anything else, they don’t make much financial sense.

2. No exam, blood or urine test only- These are called “non-medical policies and are common in face amounts under 250k. Typically there is no medical exam except for a brief interview on your health and blood or urine test to check for nicotine, HIV, narcotics and serious disorders (such as diabetes or medications for cancer etc). These are very common in the industry and the easiest to purchase. Insurance companies can do these over the phone with you and will pay for the blood test. You can get very good rates and most low face amount term policies are sold this way.

3. Para-med Exam- These are used where face amounts exceed the blood test only exam but usually not in excess of one million or more. A physician’s assistant or nurse weighs and interviews you and copies of your medical records are sent to the insurance company. Blood and/or urine is tested but the exam is simple and breif (blood pressure, heart and lungs listened to). It is typically non invasive and takes less than 20-30 minutes in your home. It is the most common form of life insurance underwriting method

4. Full medical exam- Typically performed in a doctor’s office and involves a full medical exam. If you are a smoker, a treadmill or lung efficiency exam is also requested. An EKG is often done as well. These are used in large policies, typically in excess of one million or more.

The bottom line is that the best rates and largest policies will involve some sort of exam. Before an insurance company is going to accept the risk of paying a claim, they have to have a reasonable assurance of a return of monies paid. The healthier you are and the better you maintain yourself, the more likely this will occur and therefore a lower rate. The highest risk factors in underwriting an individual come from nicotine use (smoking, chew etc), weight and blood content (medications, cholesterol etc).