What Is Simplified Issue Life Insurance & How It Works!

Oct 17, 2019 (0) comment

what is simplified issue life insurance

We all know that the process of getting a life insurance approval can be nerve wrecking and very long.  

As a matter of fact, a large number of people don't buy life insurance because the process is just too long.

But guess what:

Did you know that with a product called simplified issue life insurance you can get term life insurance quotes with no medical exam instantly and be covered the same day?

Today I will cover how a simplified term life insurance policy works, the pros and cons as well as how to get quotes and get covered super fast.


What Is Simplified Issue Life Insurance?


“In Plain English” - Simplified life insurance is a type of life insurance that has a fast & straightforward underwriting and approval process.


Most people confuse it as being the same as a no exam life insurance policy; however, that isn’t always the truth.


The most significant difference is that a simplified issue insurance policy is going to allow you to get life insurance in an instant without: 

  • Tons of Health Questions
  • Medical Records
  • A Medical Exam
  • Telephone Interviews
  • A Long Application

Your approval is going to be decided based on a few specific databases that will paint a picture of how insurable you are.  


These databases are usually: 

The Medical Information Bureau or MIB

The MIB’s is a nonprofit that is comprised of over 400 insurance companies that work together to determine and manage risk. 


They check to see if you have applied for life insurance before and if so, what was the outcome.  


Think of them as a credit report for your insurance application history and outcomes.

Prescription Drug Check or Intelliscript

This is going to check your history of prescription drugs, keep in mind that if you fill a prescription, it will be reported as a prescription you were taking even if you never took the medicine.

I always recommend not filling a prescription if you aren’t sure if you are going to take it.

There are also instances where a spouse gets a prescription filled for a condition that their spouse may have.

I am not going to go into the legalities of this, but I will say if that happens it will look as if you take the prescription drug and not your spouse.

Your Motor Vehicle Report or MVR

I always tell my clients that the insurance company wants to make sure that you aren’t a crazy driver.


Car insurance companies aren't the only ones that look at your driving record.


They are checking for things like speeding tickets as well as DUI’s and suspended licenses.

 

These are usually the most basic checks that are required before an insurance company can make a life insurance underwriting decision.


This is usually the process almost all no exam life insurance companies use.

Simplified Underwriting Speed Chart


Below is a quick chart comparing the different underwriting speeds to each other:


Product


Application


Underwriting


Final Answer



Total Time



With Exam


1 - 5 Days


30 - 40 Days


1 - 5 Days


Up To 51 Days


No Exam


20 Minutes


8 - 16 Days


1 - 5 Days


Up To 21 Days


Simple Issue


5 - 7 Minutes


​Real Time


Instant


 5 - 7 Minutes

You can easily see that a simplified life insurance product is going to be your easiest and fastest option when it comes to getting a life insurance approval.


There is a cool infographic here with even more details about the different underwriting processing times.

The Best Simplified Issue Insurance Company


In my honest and professional opinion, the best simplified term life insurance company goes by the name of Bestow.

Bestow is a new entrant into this space, which means they are using some the newest and most advanced underwriting methods.


However, they are backed by North American Company For Life & Health Insurance, which has been in business since 1886, that makes them over 130 years old.

Bestow offers a super fast application process and can give you an instant life insurance policy 100% online without an agent.

We created a detailed review that you can read here, and you can see for yourself why we picked Bestow as the best option for simplified life insurance.

Why You Need Simplified Issue Term Life Insurance


There are several reasons people would want to look at a simplified issue term insurance policy:

  • Life Insurance And Divorce Decree 
  • If you would prefer not to take a medical exam. 
  • You can’t wait for 3 - 12 weeks for a life insurance approval
  • You don’t like needles
  • You are not in the “best of health.” 

As you can see, there are some great benefits to purchasing a simplified life insurance policy.

Pros & Cons Of
Simplified Term Life Insurance


Pros

The best thing about a simple issue term life insurance policy is that you are able to get an instant answer of approval or decline, a very small amount of underwriting and you usually can make your payments and have proof of coverage the same day


Cons

The only con I can honestly think of is that the premiums are usually more expensive on a month to month basis than they are for a traditional term life insurance plan that would require an exam. 

Simple Issue Life Insurance Vs No Exam


Simplified Issue


  • No Medical Exam Required
  • No Medical Records Required
  • No Phone Interview Required
  • Real Time Underwriting 
  • Fast Application Process
  • Decision In Under 5 Minutes

No Exam


  • No Medical Exam Required
  • Medical Records May Be Required
  • Phone Interview May Be Required
  • Underwriting Takes A Few Days 
  • Fast Application Process
  • Decision In 5 - 10 Days

Alternatives To Simplified Issue Insurance?


Now that you understand the differences between a simplified issue life policy and a no exam life insurance policy I want to go over the different alternatives you have when it comes to getting life insurance.


Fully Underwritten Life Insurance 


This is your traditional term life insurance product, it is going to require an exam, medical records, financial records, telephone interview and is typically going to take the longest time to get approved, but, if you are accepted, it will usually come with the most affordable rates possible.


No Exam Life Insurance 


No exam life insurance is going to give you a faster approval time than traditional fully underwritten life insurance, but it will not be as fast as a simplified issue insurance product.


You will get to avoid the exam; however, depending on the product, you might still be required to submit medical records or complete a telephone interview.


Simplified Issue is the best life insurance for young adults.


Guaranteed Issue Life Insurance 


I only recommend this option as a last resort because it is going to be your most expensive option.


These policies don’t require any type of underwriting and anyone can get covered by them which makes them Guaranteed Issue.


Usually, they have a coverage limit of around 25,000 dollars as well as a 2 year waiting period before benefits payout 100%.


There can also be age restrictions usually between 50 to 85 so people younger than that wouldn’t qualify.

Is Simplified Life Insurance Worth It?


The world of insurance is changing rapidly with all of the new technologies being built for it, and that is a great thing.

I think simplified term life insurance should be the first option for everyone before they try to get traditional insurance.

If you think about it, we should be buying life insurance when we are in our early 20’s and the best product for that is simplified issue term life insurance.

We would still get excellent rates and a super fast process.

It doesn’t cost you anything to apply for a simple issue life insurance policy, and guess what, if you are approved you can pay for your policy immediately and be covered within a few minutes.

To me, simplified life insurance is definitely the best term life insurance policy, and is well worth; below you can find out how to get it.

​Frequently Asked Questions


What is simplified underwriting?


Simplified underwriting is when an insurance company is able to approve an application based solely on information it pulls from a database or a telephone interview. 


This process of underwriting is much faster than the fully underwritten method.


​What does fully underwritten mean?


Fully underwritten means that a person, known as an underwriter will review your policy, you will be required to complete an exam, give medical records, have a telephone interview, and answer multiple health questions.


This is a much slower process compared to simplified underwriting.


​​What is guaranteed issue life insurance?


Guaranteed issue life insurance is life insurance that you can get without answering any health questions or completing an exam.


These policies will usually have a waiting period attached to them along with a very high monthly premium.


What is simplified whole life insurance?


Simplified whole life insurance is the process of getting whole life insurance through the simplified underwriting approach.


This means no exams, no medical records, no blood, and a faster turn around for an answer on your approval.


What does it mean when an insurance policy is underwritten?


​Being underwritten for an insurance policy means that you are being reviewed to see if the insurance company will take a risk on your life based on your current medical situation, lifestyle, age and gender.

Taking Action


The fastest way to get a simplified issue life insurance quote is to shop online.

There really isn’t a better option outside of clicking here or one of the buttons throughout this post.

Of course, you can always reach out to a life insurance agent to get a simplified issue term life insurance quote if you need additional assistance.

However, I am sure that the online application process with Bestow is easy to follow and you can get covered immediately.

There is no better time than now to apply for life insurance, and you can no longer make taking an exam your excuse for not getting covered.

Sa El is the Co-Founder & CEO of Simply Insurance. He is a Licensed Life and Health Insurance Agent with over 11 years of experience in the industry. He is an Entrepreneur, Insurance Educator and Field Underwriter. Sa is on a Journey to get 1 Million Families insured.

All posts by Mark Mathon

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