Do I Need A Medical Exam To Purchase Life Insurance?

Over my 25+ years selling life insurance I have had a lot of people ask me about medical exams. "Who pays for the exam?" and "will needles be involved?" seem to be a couple of the biggest concerns. Over the years, exam requirements have changed, so let's take a quick look and see what the medical exam is all about.

The process starts when an application is completed. If an exam is required, the agent will contact an approved paramed exam company and have a nurse schedule a time to meet with the insured at their home or work. The insurance carrier pays for the exam which is good. 

When the nurse arrives they will have all the supplies they need, including devices to check blood pressure, height and weight. More than likely they will need a urine sample and some blood to send back to the lab. Drinking plenty of fluids beforehand can make that part a lot easier and less time consuming.

Years ago, I had a client who was deathly afraid of needles, thus making her blood pressure spike. Trying to convince an underwriter that the client's blood pressure was usually normal was fruitless. We eventually took the business to another carrier that didn't require an exam.

One of the more important factors of whether there will be an exam or not is the face amount of the policy someone is applying for. Some companies will require an exam for policies over $100,000, but we have one carrier who doesn't require an exam for policies (term or whole life) below $250,000. Instead they will just require medical records. Rest assured that a $1 million policy will require an exam.

An interesting point here is that insurance companies that don't require an exam may have higher premiums. This is because they recognize that they aren't all the information necessary and pass that higher risk on in the form of premiums.

During the COVID epidemic, clients didn't necessarily want nurses (who apparently had visited other people) in their homes. Many insurance companies adjusted and cut down on the exam requirements.

Another factor is that AI is now being used more by analyzing medical records. This has sped up the underwriting process but there is still room for improvement when it comes to accuracy.

Don't let a fear of needles prevent you from getting the coverage you need to protect your family or business. When you get a quote from our website you'll be able to see if an exam is required from that insurance carrier. You may not even need an exam!

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life and disability insurance coverage. He's also is a professional speaker helping sales people be more productive and efficient and has spoken to professional and civic organizations throughout the Southeast. Please subscribe to this blog!

How Long Should My Life Insurance Coverage Last?

How long should your life insurance last? This is a common question but not one that is easy to answer. That's because there are a myriad of reasons to buy life insurance. The actual question should be, "How long do I need my policy to last?"

Think of term life insurance as fulfilling a specific need for a specific time. In other words, if you do some math and calculate how much you need (see the previous post) you can also determine how long you need it. If you have a 30-year mortgage, then a 30-year term policy will cover that loan. 

A good example would be a young couple with some small children and a new mortgage. They will need to purchase a policy that will pay out until the house is paid off and the kids are out of the house. Of course, no one knows how long the kids will be around or if you'll be refinancing down the road, but a good estimate is better than nothing.

If you know how long you'll need the policy, then you determine the length of time. You can even "ladder" several policies if you really want to be specific. 

Then there's the inevitable fact that we're all going to die eventually, even if we have done the math and outlived our term policy. That's when permanent life insurance (whole life and universal life) come into play. Unless you are able to prepay for all of your funeral/burial expenses, you may have to purchase "final expense" insurance. 

Like it sounds, permanent insurance will cover you until your death, however, you can pay up premiums early. Many carriers will offer "paid up in 10 or 20 years" or "paid up at 65" options. I recommend the "mix and match" method of purchasing a permanent policy (enough for your funeral and any medical expenses associated with your demise) at the same time you purchase your term life. It's much less expensive in the long run.

If you have questions feel free to contact us.

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life and disability insurance coverage. He's also is a professional speaker helping sales people be more productive and efficient and has spoken to professional and civic organizations throughout the Southeast. Please subscribe to this blog!

How Much Life Insurance Do I Need? (DIME + 1)

A common question that people ask is "How much life insurance do I actually need?" For most people with families and maybe even a business, the simple formula is the DIME method, which works as follows:

Debt - Calculate your debt, and ALL of it. Car loans, student loans, credit cards, etc. If you should die before paying off these debts, your family or estate could be on the hook for the money owed. 

Income - Many people fail to include the loss of their income into their coverage. If you are the main breadwinner, that lack of income could significantly impact your family's ability to pay bills or other items, like car repairs or sudden medical bills. And if you're not the main earner but do contribute to a large portion of the bills, your income should still be included. The rule of thumb is usually 3-5 years of income should be added to the death benefit. 

Mortgage - Yes, your mortgage does count as debt (see above), but some people will purchase "mortgage protection" coverage. In most cases this is a "decreasing term" policy, with a few health questions. In my opinion, it can be more expensive than just paying for "level term" policy with the death benefit staying the same throughout the life of the policy, but underwriting may be more involved.

Education - If you have children, you might want to make sure they can pay for any higher education expenses in the event that you're no longer in the picture. There are many college calculators on the web.  

There's one more cost that I think many people overlook, which is final expenses and the costs associated with death. Funeral costs can vary but assuming that the average is around $13,000 and that most people will die from illnesses that will require hospital and other medical bills, I suggest about $25,000 total. 

Another note on final expense insurance: If you have your "final expenses" already figured in, you can save a lot of money down the road without having the two-year wait that some policies will insist on. We'll cover final expense insurance in a later blog.

If you have questions on calculating your total coverage let us know.

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life and disability insurance coverage. He's also is a professional speaker helping sales people be more productive and efficient and has spoken to professional and civic organizations throughout the Southeast. Please subscribe to this blog!