Simplified Issue Life Insurance

What is Simplified Issue Life Insurance?

A type of final expense insurance that is beneficial for those who have some mild health issues. Simplified issue life insurance offers coverage without undergoing a medical exam usually required for a term insurance policy. However, it has a smaller death benefit than term because of greater risk. 

An exciting fact about this plan is it provides limited coverage instantly, making it an appealing option for those who don’t want to give a medical exam. 

How Does This Plan Work?

With this plan, one can expect to have a valid insurance policy as soon as the application is accepted. Instead of a medical exam, applicants would answer a short questionnaire. It will help the insurance provider to get a modified risk assessment and decide on a premium and death benefit. 

Moreover, some insurance companies offer this plan as either a permanent or a term life insurance policy. Based on the company’s terms, you may or may not be allowed to add riders to increase your coverage or death benefit.

Benefits of Simplified Issue Life Insurance 

The policy offers you various benefits. Some primary benefits are:

• No underwriting process.
• Premiums never go up.
• Coverage never decreases.
• Covers burial and funeral expenses.
• Coverage starts immediately after application approval. 
• Higher death benefit and lower premium than guaranteed issue plan.

Who Needs a Simplified Issue Policy? 

This plan would be the best fit for someone who needs life insurance coverage but delaying it due to a medical examination. It would also be an ideal policy for those who require life insurance ASAP with no waiting period. 

However, some other situations also make sense to get a simplified issue plan: 

• You are hesitant to give a medical exam
• You are unsure whether you qualify for standard insurance plan types. 
• You need immediate coverage for your final expenses. 
• You require collateral for a loan. 

Simplified Issue vs. Guaranteed Issue Insurance

The thing that differentiates these plans is the medical questionnaire. Your health condition is determined via your answers and then the insurer will dictate whether you can get the cheaper premium with enough death benefit. 

Here we will provide you with some sample questions you may have on your medical questionnaire:

• Have you ever been diagnosed or treated for AIDS, HIV, or Congestive heart failure?
• Have you been advised to use oxygen equipment helpful with breathing within the past 12 months?
• Are you using a wheelchair because of a medical condition or disease? 

Meanwhile, these are just samples and each insurer has its own questionnaire. There is a possibility that you may not qualify for this plan with one company and may get with another. So it is suggested to consult an insurance agent and get their guidance. 

Call us to get a free consultation from our insurance professional.