Can I Get Life Insurance Without a Medical Exam?

When you’re thinking of taking out life insurance, you’re faced with some decisions that can affect both you and your beneficiaries. Among these decisions is whether to opt for a policy that requires a medical exam. While it is possible to secure life insurance, including Term Life Insurance, Income Protection, Total and Permanent Disability (TPD) and Critical Illness (Trauma) Insurance without having a medical exam, it's important to understand the implications of doing this.

Why your insurer may ask for medical exams

When applying for life insurance, insurance companies may request you have a medical exam to assess your health status. This is an important step in the underwriting process. These exams help insurers evaluate the risk of providing you with cover and are used (in part) to determine the premiums for your life insurance, as well as whether to offer you cover on standard rates or subject to a special condition.

Essentially, these medical checks serve to protect both the insurance company and the policyholder, ensuring that the terms of the life insurance products are based on accurate and current health information.

What is being checked in a medical examination?

Following a medical examination, insurers will receive information regarding pre-existing health conditions or lifestyle choices. Common checks include blood tests, blood pressure tests, urine tests, and questions about you and your immediate family’s medical history. These exams can help uncover any health issues that might not be apparent to you but could have a bearing on the terms of the life insurance policy provided to you.

The benefits of medical exam life insurance

Undergoing a medical exam can have advantages:

• Smoother claims process

  A medical exam ensures that the life insurance you purchase is based on an accurate assessment of your health and you are aware of what you are covered for under the policy. This can assist in preventing potential disputes or denials of claims for undisclosed medical conditions, as the insurer has a clear picture of your health at the time of application. If you fail to disclose a medical condition, this may impact your claim.

• More comprehensive coverage

  Having a medical exam may allow you to access more comprehensive cover with higher benefit limits than policies that do not require a medical examination (no-exam policies), so you can get more comprehensive financial protection for your loved ones.

• Premiums may be lower

  Depending on the particular policy you choose, you may pay lower premiums if the exams show you're in good health. Insurance for good health, so to speak, rewards people who present a lower risk with more favourable policy terms. Since the exam provides a detailed assessment of your health, insurers can offer rates that accurately reflect your risk level subject to the overall underwriting assessment and other factors such as prior medical history.

• Access a wider range of options

  Choosing to have a medical exam as a part of a broader application process may open up a wider range of life insurance products and features. Insurers may offer differing product options including those with additional benefits and riders, when they have a full understanding of an applicant's health.

• You could get a policy that takes your pre-existing condition into account

  A medically underwritten policy might actually benefit you if you have pre-existing health conditions. Through the examination process, insurers can assess the severity and control of these conditions, potentially offering cover with exclusions or accommodating the risk with higher premiums.

Things to know about no-exam life insurance

Life insurance without medical exams may be convenient, however, it comes with some trade-offs. Let’s consider the positives and negatives.

Reasons you may choose a life insurance no medical exam policy:

• Speed and convenience

  One of the advantages of no-exam life insurance policies is speed. Because you can get cover without needing to book and undergo a medical exam, the approval process is typically faster.

• Medical conditions

  You might opt for a no-exam policy if you have certain pre-existing medical conditions and are worried that a medical exam would disqualify you from being approved for life insurance. With a no-exam policy, you may be able to get at least a basic level of insurance, even if it comes at a higher cost or has an exclusion applied for any pre-existing conditions.

• Age considerations

  Older people might find no-exam policies more accessible, as these policies can sometimes be easier to qualify for than traditional life insurance.

While the allure of bypassing a medical exam might seem appealing, it's important to be aware of the potential drawbacks of no-exam life insurance policies:

• Coverage limitations

  These policies often come with a cap on the amount of cover available, which might not meet your particular needs.

• Higher premiums

  The lack of medical information means that some insurers will charge higher premiums to account for their uncertainty about your level of health.

• Less customisation

  Policies offered with no underwriting and medical examination may be more limited than what could be obtained via an underwriting process with an insurer.

• Exclusions for pre-existing conditions

  There's a higher likelihood that no-exam life insurance policies will exclude coverage for pre-existing conditions.

Knowing your policy has been underwritten with a comprehensive understanding of your health can give you peace of mind. You can rest assured that your premiums are accurately priced for your specific situation, and your coverage is aligned with your needs and health status. While getting a no medical life insurance policy is possible, it's essential to weigh the benefits and limitations of this approach.

Before making a decision, consider comparing life insurance options, and reading the relevant product disclosure statement (PDS) and target market determinations (TMD) to choose a policy that aligns with your health status and coverage requirements.