For individuals looking for life insurance coverage for financial security without having to go through a lengthy underwriting process, simplified issue life insurance provides a quick and convenient means to do that. Simplified issue life insurance policies are specifically designed for people who have health concerns and those who prefer a quicker life insurance application process. The policies require just a few questions about the medical history and health status of the person who wishes to buy coverage.
This type of insurance has made it a desirable option for a lot of people, especially those who find it difficult to obtain life insurance coverage through conventional ways. To know more about this life insurance, ensure you read to the end of this article, as we will be exploring the key features of the policy, as well as the advantages and disadvantages.
What Is Simplified Issue Life Insurance?
As the name implies, simplified issue life insurance is a simple type of policy that features quick and concise underwriting procedures. While most traditional life insurance policies have lengthy underwriting processes, that of simplified issue life insurance is simple and concise.
The primary aim of simplified issue life coverage is to streamline the coverage process for policyholders who find it difficult to obtain coverage from several insurers. Nevertheless, it does not change the fact that questions about the health conditions of the applicant will not be asked. The only difference is that simplified issue life coverage asks very few questions as regards the health of the applicant.
What Are the Pros?
One of the quickest ways to get life insurance is through a simplified issue. In addition to the ease and convenience it offers, here are some of the advantages of this life insurance:
Short Application Process
Applying for this Life insurance will not take much of your time, unlike a standard life insurance policy where you have to flip through so many pages to apply for coverage. The application process for a simplified issue is short and straightforward.
Quick Approval
Implied issue life insurance makes it easier for applicants who seek coverage to avoid lengthy underwriting processes. If you apply for a simplified issue life policy, the coverage can get approved within minutes, unlike the traditional underwriting process where you have to wait for weeks before coverage is approved.
No Medical Exam Required
Another outstanding feature of simplified issue life coverage is that it does not require a medical exam. For those who are worried about their health problem being revealed through a medical exam, purchasing this life insurance is an ideal option. Insurers allow people to apply for a simplified issue life policy; the only thing required is answers to a few questions about your health.
What Are the Cons
While this life insurance is undoubtedly one of the easiest ways to get life insurance coverage, there are disadvantages attached. Let us consider some of the downsides of this type of policy:
Higher Premiums
Simplified issue Life coverage is often pricey because a medical exam was not conducted. Most insurance companies can assess how safe or risky it is to insure a person through a medical exam. Without a medical exam, it is difficult for insurers to do a risk assessment, ultimately leading to higher premiums.
Limited Coverage
As a result of not disclosing vital information about your health and medical history, the coverage you will be offered will most likely not be enough for your needs. For those who seek a one-million-dollar life insurance coverage, it is advisable to consider other alternatives.
Graded Death Benefits
This is another disadvantage attached to purchasing simplified issue life coverage. Certain simplified issue policies require that you have the policy for at least two years before your death for your beneficiaries to receive the entire death benefit. If a policyholder passes away within two years of obtaining the insurance, the beneficiaries will normally receive a return of the premiums paid on the policy.
Who Needs Simplified Issue Life Insurance?
Simplified issue Life coverage could be an ideal option for certain types of people, such as
- Individuals with serious health concerns.
- Busy professionals seeking quick coverage.
- Those who have difficulty obtaining traditional coverage.
- Those who want to avoid a medical exam.
- Seniors want to avoid a lengthy application process.
- People seeking short-term financial protection.
- Those looking for a straightforward application process.
If you fall under any of the categories of people mentioned above, then getting a life insurance policy through a simplified issue makes so much sense.
Alternatives to Simplified Issue Life Insurance
This life insurance may not be the right fit for everyone; hence the need to consider other alternatives. If you realize that this life insurance is not the best option for you, consider the following alternatives:
Guaranteed Issue Life Insurance
When applying for guaranteed issue life insurance, there is no medical exam required, similar to simplified issue life insurance. When compared to life insurance, the application process is even more straightforward. If you are concerned about being approved for coverage, this type of insurance assures quick approval.
Final Expense Life Insurance
Typically, final expense insurance is designed to cover the end-of-life expenses of the policyholder. The death benefit on the policy will be sent to your beneficiaries and used to cover outstanding medical bills and burial costs. Compared to simplified issue life coverage the final expense is less expensive.
FAQs
Is simplified issue life insurance worth it?
The ease and convenience that come with simplified issue life insurance makes it sought after by so many people. Whether or not the policy is worth it depends on your unique situation. If you wish to avoid a medical exam and a lengthy life insurance application process, then a simplified issue is an ideal option.
How much does it cost?
According to Forbes Advisor, the average cost of a 10-year simplified issue policy of $100,000 is around $28 per month. Nevertheless, the cost of coverage largely depends on your age, health, coverage amount, and the length of coverage you want. The price also varies by insurer; you can get the best rate by shopping around and comparing quotes.
Who can apply for simplified issue life insurance?
Anyone can apply for simplified issue life insurance. It, however, mostly appeals to individuals with health issues and seniors who wish to avoid lengthy application processes.