Guaranteed Issue Life Insurance

This is a typical kind of life insurance marketing tactic. You will see it advertised on the television or online or in print when looking for Guaranteed Issue Life Insurance. Several companies in this market often send out solicitation flyers and mailings. These kinds of insurance companies advertise that:

• “No one will call on you.”
• “No medical is required.”
• “Instant issue but only after answering medical questions.”

If this sounds familiar, you may have seen several of these types of advertising by insurance marketing companies. The problem with this type of life insurance is that you will likely pay too much for your coverage to avoid having to see a nurse and provide some blood work. We have also found that the questions on some of these applications are not that clear, which may lead to claim denials, and the person who completed the application is no longer around to argue at claim time.

Another aspect of some of these plans is the marketer is not the insurance company underwriting the coverage. At claim time, when your family call to file a claim, they are often told that they have to work it out with the insurance company. We are independent brokers. Make sure you know who you are dealing with before you buy.

Edge Benefits is considered a Third Party Administrator, focused on providing selected products like guaranteed issue life and critical illness insurance up to $25,000, underwritten by various insurance companies, e.g. ACE INA Life Insurance Company underwrites their Final Expenses plan. It is a guaranteed issue product, and consequently, no health questions are asked. Consequently, it has a two-year deferral, during which time, if the insured passes, the premiums plus interest are refunded. The considerations are fundamental as it is a guaranteed issue. We have sold several policies with no issues as the application is straightforward, given there are no medical questions.

Product features

• Available from age 30 to age 85 in increments of $5,000 between $5,000 and $25,000
• Only available for Canadian citizens or permanent residents (or landed immigrants) of Canada
• Not available if you are contemplating living permanently outside of Canada within the next 24 months or are an airplane pilot of a non-commercial airline plane.
• Non-smokers are offered a discount.

Wawanesa is seldom the cheapest, but occasionally, we have people who would not qualify for other policies yet can answer “no” to these questions.

1. Within the last two years, have you had a stroke, heart attack or been advised to have heart surgery?
2. Within the last three years, have you consulted a physician for or received treatment for cancer?
3. Within the last three years, have you been declined for individual life insurance by Wawanesa Life or any other insurer?
4. Have you been diagnosed, treated for, or had any indication of AIDS or AIDS-related complex?
5. Are you currently restricted to a wheelchair, bedridden, hospitalized or confined to a nursing home?

Alternative Permanent Plan is designed for people who have medical issues or do not want to do a medical or provide a doctor’s report. This type of Guaranteed Issue Life Insurance product is a two-year deferred policy for people of age six months to 80 years, providing the youngest coverage for this type of product. It is also available in a 20-year term version where the coverage ends after 20 years but is much more affordable. The 20-year plan could be used for covering part of a mortgage.

Product features (lifetime coverage)

• Payment doubles if death occurs due to an accident
• In the first two years, payment is premiums paid plus an interest function unless death occurs as a result of an accident
• There is no discount for non-smokers which will result in a benefit for smokers as far as pricing is concerned.
• Available in amounts from $5,000 to $50,000 (20 year term policies available for $10,000 to $100,000)

Product variations

• Basic life insurance paid for over the term chosen
• Same as above but with a built-in inflation protector so that the amount of life insurance increases by 3% per annum until it is double the initial face amount.
• Payment periods of 10, 20 or to age 85 depending on your age.

Qualifying questions

1. Currently capable of carrying out by himself/herself any basic activities of daily living such as: getting up, walking, washing, dressing, eating and is not suffering from incontinence;
2. The proposed insured is not under guardianship;
3. The proposed insured, if a child, is capable of carrying out by himself/herself all basic activities of daily living according to his (her) age;
4. The proposed insured is not currently admitted to a hospital, clinic or extended care facility OR a resident of a health establishment such as a nursing home OR a residential care centre OR a resident of a home for individuals with reduced physical or mental autonomy;
5. The proposed insured is not currently being tested for and has not been diagnosed with, informed of or treated for any type of cancer during the past three years;
6. The proposed insured has not been informed that he/she has tested positive for the human immune deficiency virus (HIV);
7. The proposed insured does not have Acquired Immune Deficiency Syndrome (AIDS) or any AIDS-related disease;
8. In the last six months, the proposed insured has not used drugs such as opium, heroin, morphine, codeine, Demerol, barbiturates, amphetamines, cocaine, hallucinogens and anabolic steroids other than as prescribed by a doctor or methadone as prescribed or not by a doctor.

Alternative Term Plan is designed for people who have medical issues or do not want to do a medical or provide a doctor’s report. It is available in a 20-year term version where the coverage ends after 20 years but is much more affordable. This could be used for covering part of a mortgage.

Product features (coverage ends after 20 years)

This policy is available in amounts of $10,000 to $100,000, and it has a two-year deferral period during which if death occurs, the premiums plus and interest component are refunded. The qualifying questions are similar to the Alternative permanent insurance version.

Product questions

1. Are you currently
   • Incapable of independently carrying out at least one of the basic activities of daily living such as: getting up, walking, washing, dressing or eating?
   • Admitted to a hospital, clinic or extended care facility or are you a resident of a health establishment such as a nursing home, a residential care center or a resident of a home for individuals with reduced physical or mental autonomy?
   • Under guardianship or curatorship?
2. Within the past three years
   • Have you had surgery, been hospitalized, been prescribed one or more drugs, been diagnosed as suffering from or received treatment for one or more of the following conditions:
     • Angina pectoris, coronary insufficiency, myocardial infarction (heart attack),
     • Chronic pulmonary disease requiring the administration of oxygen at congestive heart failure in the hospital or at home?
     • Coronary artery dilatation (angioplasty) or coronary bypass surgery?
     • Cirrhosis of the liver, chronic renal failure or Alzheimer’s disease
     • Malignant tumour, cancer, leukemia or lymphoma? f) Replacement, transplant or graft of an internal organ?
3. Have you ever used any hard drugs such as opium, heroin, morphine, amphetamines, cocaine, hallucinogens, anabolic steroids not prescribed by a physician, or methadone (whether prescribed by a physician or not)?
4. Have you ever been informed of a positive test result, or are you a carrier or sufferer of Hepatitis B or C or chronic Hepatitis, HIV (AIDS virus), AIDS or any other AIDS-related illness?
5. Are you waiting to undergo an investigation, including a biopsy, or to undergo diagnostic tests in neurology, nephrology, oncology or cardiology, or have you been advised to undergo such an investigation or such tests but have yet to act on such advice?