Life Insurance: Procedure For Policy Purchase

Life insurance is a big decision, and it's important to understand the process before you begin. The application process is often quick and easy, but it's important to be aware of what's involved. The insurance company will evaluate your risk of death and assign a cost to the policy accordingly. You will usually need to answer medical questions and submit to a medical exam, although 'no-exam' policies are available.

The application process

While you wait for a decision, your financial professional may request a check for the first premium payment in order to "bind" your coverage. This gives you and your beneficiary interim coverage while you wait to hear back from the insurer. The underwriter will carefully review your application and medical exam results. If instantaneous coverage isn't offered, it usually only takes days instead of weeks to get a coverage decision.

It's important to be truthful when answering questions during the application process, as insurance fraud is a felony in every state.

The medical exam

It's important to be truthful when answering questions about your medical history, as insurance fraud is a felony in every state.

The review process

The medical exam typically involves taking your vital signs, collecting blood and urine samples, and gathering information about your family's medical history. Sometimes a treadmill test or EKG is also required. The exam should take less than 30 minutes and is usually paid for by the insurer.

While you wait to hear back from the insurer, your financial professional may request a check for the first premium payment to "bind" your coverage. This gives you and your beneficiary interim coverage.

It is important to be truthful when answering all questions as insurance fraud is a felony in every state.

The cost

While everyone's situation is different, the cost of life insurance is an important factor to consider when shopping for a policy. It's important to find a policy that fits comfortably into your monthly budget. To "bind" your coverage, your financial professional may request a check for the first premium payment. This gives you and your beneficiary interim coverage while you wait to hear back from the insurer.

The coverage

Most life insurance policies require that you answer medical questions and submit to a medical exam. This typically involves taking your vital signs, collecting blood and urine samples, and gathering information about your family's medical history. Sometimes a treadmill test or EKG is also required. The exam should take less than 30 minutes and is usually paid for by the insurer.

There are "no-exam" policies available, but these usually cost more and have a lower face value. If you opt for an online application, you may receive an instantaneous decision on your coverage. If not, it usually only takes a few days to get a coverage decision.

While you wait for a decision, your financial professional may request a check for the first premium payment in order to "bind" your coverage. This gives you and your beneficiary interim coverage while you wait to hear back from the insurer.

Frequently asked questions