Simplified Issue vs. Fully Underwritten Life

  • Originally published January 20, 2015 , last updated January 28, 2015

As an agent writing life business, you have a choice between simplified issue or fully underwritten. (Because guaranteed issue does not involve underwriting, it is not discussed here.) It is easy to understand why simplified business is popular with agents. Faster issue, faster pay.

But let’s look at what fully underwritten business has to offer your clients. While simplified issue and its faster pay may be good for you, is it good for your client? When you write simplified life, what you may be saying to your client is, “You don’t have to do a para-med exam, but this insurance is more costly.”

One method is not necessarily better than the other, but if your clients are in good health, they would gain a tremendous advantage by considering full underwriting. Here are some of those advantages:

  1. Much more insurance for the same premium.
  2. Better product selection to choose from.
  3. The para-med is a free exam. What a great opportunity to get a current report on your health status. (Para-med exams have also uncovered health issues for people they did not realize they had and were able to follow up with their doctor).

If we as agents really want to do what’s best for our clients, then let’s take a moment and evaluate the situation. Maybe a fully underwritten product is the answer.