what is simplified issue life insurance policy? why is it easy to obtain?
Total Comments: 1
Posted: Mon Jan 07, 2013 06:03 pm Post Subject:
Simplified issue typically means the insurance company requires less medical underwriting (sometimes none) as long as the amount of insurance is relatively minimal (perhaps as much as $100,000 - $250,000). Because this is not a "standard" term, the process will differ from one company to another, but may often be distinguished from "jet-issue" or "guaranteed issue" policies which generally require no medical underwriting at all (and normally limit coverage to no more than $25,000-$50,000).
Why is it easy to obtain? Because the insurance company often charges very high substandard rates (especially for the jet issue and guaranteed issue policies) to cover the likelihood that the insured is not a standard risk -- as in the case of today's popular "final expense" insurance.
A number of companies now offer a variation on "simplified issue" from the agent's perspective, with electronic application submission rather than paper forms. While this may simplify the process of submitting an application and reduce paperwork handling by the insurance company, it may not "simplify" the underwriting process, which can still require medical examinations, tests, or blood and urine profiles.
Posted: Mon Jan 07, 2013 06:03 pm Post Subject:
Simplified issue typically means the insurance company requires less medical underwriting (sometimes none) as long as the amount of insurance is relatively minimal (perhaps as much as $100,000 - $250,000). Because this is not a "standard" term, the process will differ from one company to another, but may often be distinguished from "jet-issue" or "guaranteed issue" policies which generally require no medical underwriting at all (and normally limit coverage to no more than $25,000-$50,000).
Why is it easy to obtain? Because the insurance company often charges very high substandard rates (especially for the jet issue and guaranteed issue policies) to cover the likelihood that the insured is not a standard risk -- as in the case of today's popular "final expense" insurance.
A number of companies now offer a variation on "simplified issue" from the agent's perspective, with electronic application submission rather than paper forms. While this may simplify the process of submitting an application and reduce paperwork handling by the insurance company, it may not "simplify" the underwriting process, which can still require medical examinations, tests, or blood and urine profiles.
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