Reader’s Question

I also would like to know why term life insurance with no medical exam generally has higher premium. I’ve made some notes about it already, but would love it if you could provide me with a definitive answer.

Didi Bairnes

Carson City, Nevada

Yes, you are right that term life insurance with no medical exam is more expensive, compared to those policies that require a medical exam. Let us take into account the perspective of the companies which provide these insurance products. It is very risky on their part to offer this kind of insurance without the need for any medical clearance or certainty that these insured individuals are really fit and are far from getting familial diseases. Life insurance usually requires a medical assessment in the form of a questionnaire which an applicant for the product must answer to the best of his knowledge and very honestly. In this aspect, the companies only hold on to the answers of the applicants, which means the company has to make room for misinformation which could have been brought about some factors like poor memory with regards to family history, inadequate information about parents’ illness or health problems, misunderstanding of questions, or even dishonesty for some who would just like to get insurance coverage at a smaller premium. All of these are contributors of risks for life insurance companies. Thus, they factor in some of these understandable “risks,” resulting to a higher premium for those people without a medical exam.

For those who are thinking that they could just fake their answers in the questionnaires given to them just to avoid higher premium, you should bear in mind that although the company may lose something from it, the one you will truly be cheating is no other one than yourself. Yes, you may not have to worry about paying bigger premiums year after year just so that your death benefits will be intact, but in the greater scheme of things, there are more reasons for you to worry about like the schooling of your children, the allowance of your loved ones you will be leaving and the medical needs of your wife or your husband if you pass away earlier. Lower premiums may lead to smaller death benefits that could not actually cover these things, especially if you have health problems you are at risk of.

If you really want a low cost term life insurance with no medical exam, you can get a quote first to be sure you are getting the best deal in the market. Fill up an online form just like the one you see above this page, and provide basic information about yourself. You will den multiple results from various life insurance companies.