Think About The Pros And Cons Of No Medical Life Insurance
Life insurance is one of those things that everyone should have, but many people do not. There are two ways to get life insurance in Canada. The first is buying a policy from a traditional insurance company, which involves meeting strict criteria for health and lifestyle. Insurance companies understand the difficulties customers face when setting up their policy, which is why most companies have started to, or have looked at getting an insurance agent management system to make it much easier to go through the criteria to set up your policy.
The other type is no medical life insurance policies, where there is little or no medical information required to purchase life insurance.
The leading supplier of no medical simplified issue life insurance is through Canada Protection Plan (CPP). You have more than likely seen their television ads where they offer insurance to anyone between the ages of 20 – 80 with savings of 30% or more.
CPP has been in Canada for years, and their underwriter is Foresters Insurance – an insurance company that has been in Canada for 135 years. However, there are other insurance companies such as the following who also sell no medical life insurance policies:
- Assumption Life: This company offers a variety of life insurance products, not just no medical.
- Industrial Alliance: Is the fourth largest insurance company in Canada. In addition to offering no medical life insurance, Industrial Alliance offers financial services too.
- Humania Assurance: Started selling life insurance as early as 1874.
In Canada, there are two types of no medical life insurance – simplified Issue life insurance and guaranteed issue life insurance. Below we will take a look at the differences between the two.
Simplified Issue Life Insurance vs. Guaranteed Issue Life Insurance
Both simplified issue life insurance and guaranteed issue life insurance, are similar in that their products are best suited to people who more than likely would be turned down by traditional insurance companies. The people who are the best fit for no medical life insurance include people who have major health issues, unhealthy family histories, are overweight and are involved in dangerous activities.
The difference between guaranteed issue life insurance and simplified issue life insurance is that guaranteed issue life insurance does not ask for medical information. On the other hand, simplified issue life insurance asks carefully selected questions. Although there are no medical questions for guaranteed issue life insurance, the cost of the policy is higher and have a limited benefit coverage.
Why No Medical Life Insurance Might Fit Your Needs
The best part of a no medical life insurance policy is that it can be purchased quickly and without an investigation into the applicant’s health and lifestyle. In fact, with guaranteed issue life insurance, there are no questions required at all. The applicant only has to pay the premiums for this policy to take effect.
No medical insurance is more expensive than traditional life insurance, and the policy pays out with lower benefits.
Traditional Life Insurance
Traditional life insurance is the best type it is cheaper, more secure, and pays out more for benefits. However, if someone has a major medical condition, they may get turned down; and it is not ideal for others who don’t want to wait for all the paperwork and investigations to be completed.
If you are unsure if you qualify for a traditional life insurance policy you can take advantage of a preliminary inquiry.
A preliminary inquiry is informal and is made to an insurance company by an insurance broker. The inquiry is done by insurance brokers and is used to alert their clients of a potential possibility of a decline. This is very beneficial to applicants because once they are declined for life insurance, it is very hard to get coverage from another insurance agency.
The name of the applicant is never divulged when a preliminary inquiry is done. However, prior to making the inquiry, the broker needs to find out as many details as they can about the applicant.
It is a good idea for clients who think they may be turned down for a traditional life insurance policy to first apply for a simplified issue policy and then apply for a traditional policy. This way, if they aren’t approved, they can keep their coverage with the simplified issue policy.