Ask Clark: Should I Buy Life Insurance Right Now?

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With the news of an increasing death toll from the coronavirus pandemic, you might be thinking about buying life insurance.

Money expert Clark Howard says that’s a good idea, but he says that it only makes sense to get quotes for one particular kind of life insurance policy at this time.

This Is the Only Kind of Life Insurance Policy You Should Shop For

Clark is a big fan of term life insurance because of the simplicity of the product.

You buy coverage for a term — typically 10, 15, 20 or 30 years — and it only pays a death benefit if you pass away while the policy is active. There’s no complicated investment component like there is with whole life insurance. Furthermore, the monthly premiums are typically low and stay the same throughout the life of the policy.

But getting term life insurance can normally be a long process. It often takes about a month from applying to when a policy is issued.

The insurer has a formal plan of review they adhere to before accepting you as a client. This underwriting process typically includes tests to determine your blood pressure and cholesterol levels, plus a physical exam.

In addition, an insurer will look at your family medical history, occupation, mental health, driving record, travel habits and maybe even your credit history. That final metric helps them determine if you’re likely to keep paying the premium once your policy is written.

However, there are insurers who do instant-issue term life insurance by vetting you with an algorithm — not a doctor’s visit. And Clark says you should be looking exclusively at them right now.

“Getting any other kind of life insurance right now is likely a non-starter because of the enormous human involvement that’s required with normal insurance.”

Where to Shop for an Instant Issue Term Life Policy

The internet has really democratized shopping for instant-issue term life policies. With these kinds of policies, you simply answer a series of questions about yourself and your general state of health in order to qualify.

Then, if you fall within insurance company parameters, the insurer will write you a term life policy on the spot without any further examination.

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The whole application process takes about 10 to 15 minutes and you don’t have to schedule a visit to be poked and prodded with a needle.

Of course, not everyone will qualify for a no-exam life insurance policy. But if you do, it’s that easy!

Among the companies that issue term life insurance with no medical exam are:

These companies will typically request your MIB (Medical Information Bureau) report and a pharmaceutical report during the underwriting process. You can read more about these little-known health dossiers that are compiled on you here.

“They do computerized checks on you. And they believe they can know as much as they need to in the overwhelming percent of cases,” Clark says. “If they’re able to find the data they need to know enough about your medical history and prospects, then they instant-issue the life insurance.”

Final Thought

Clark concedes that certain insurers may balk at the idea of writing policies at this moment. But generally, they’ve calculated the risk levels involved with coronavirus and are open for business.

“Even if [the pandemic] plays worse than people might want to imagine, they have been able to sufficiently calculate risk at most insurers. So you will be able to quote and buy policies without too much difficulty right now.”

We’ve got a complete guide to walk you through the process of buying life insurance here.

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