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Instant-approval term life insurance: Everything you need to know

Instant-approval term life insurance is making the process of getting a term life insurance policy almost instantaneous.

With instant approval, you don't have to fill out multiple forms, get a medical exam, and wait a month or two to find out if you're approved. That's still the norm for most term life policies, but with instant approval, there are a handful of companies that are making quicker decisions without a medical exam.

This is done through accelerated underwriting, which uses algorithms and data to predict life expectancy and risk.

Insurance companies have offered policies without a medical exam before, but they were usually guaranteed-issue policies with limited coverage. These types of policies were often more expensive than normal term life insurance policies, too.

Instant approval isn't as expensive and can often provide coverage up to $1 million, and some companies offer limits beyond that.

Instant-approval policies aren't just easier for those applying. It also saves money for the company offering the policies.

Insurance companies pay for medical exams when a person applies for a term-life policy. Paying for medical exams can add up for an insurer.

Thanks to algorithms and better data, insurers are now able to feel confident that they can predict a person's health risk based on asking a small number of questions and analyzing online databases.

How do you apply for instant-approval term life insurance?

You go to the life insurance company's website and enter in information, including:

  • Personal information, such as age, height, and weight
  • Address or ZIP code
  • Medical history
  • Lifestyle behavior

The company's system then reviews databases to further check your health history, insurance history, and background. The system will let you know whether you're approved or whether you need to have a medical exam.

If you're not considered a risk and you're young and healthy, the process can take 15 to 20 minutes -- rather than one or two months -- and you can get a policy in an hour.

Not everyone can go through the instant-approval process. Reasons you may need to go through a full process and a medical exam are your age, medical history, family's medical history, or lifestyle, such as if you're a smoker.

Which companies offer instant-approval term life insurance?

While it’s a growing market, there are not yet many life insurance companies that offer instant approval. The main three are:

  • Haven Life
  • Ladder
  • SoFi

SoFi and Haven Life provide it in nearly every state. SoFi offers instant-approval term life insurance in all states except New York; Haven Life provides it in every state except California and Montana. Ladder also offers instant-approval, but only in California.

What do they offer?

SoFi offers policies up to $1 million if you're under 40. It also provides $500,000 policies for healthy people between the ages of 41 and 60.

Haven Life gives policies up to $1 million for people under 45.

Ladder offers policies up to $8 million for people ages 20 to 60.  It allows you to get a “ballpark quote” based on very basic information before you fill out an application.

Note: other companies have accelerated approval processes, but they're not instant-approval. SBLI is an example of a company that offers approval usually within 48 hours without a medical exam. You can check out that company if you don't need immediate approval.

How much does coverage cost?

Financial company SoFi is a recent addition to the small instant-approval market. The San Francisco-based company partnered with Protective Life Insurance Company to offer instant-approval policies in November 2016.

In addition to insurance, SoFi offers asset management, savings, mortgages, and personal loans.

Andrea Blankmeyer, vice president of finance at SoFi, said the instant-approval product fits perfectly with SoFi's customer base, which is mostly 25- to 45-year-olds with a weighted average median in the mid-30s.

Blankmeyer said the company's model customer is Henry (High Earner Not Rich Yet). Henry is a 20- or 30-something who may have become a SoFi customer when he looked to refinance his student loan debt to a low-interest loan.

SoFi customers are usually well-educated and low insurance risks, said Blankmeyer.

SoFi said Millennials are least likely of all generations to have life insurance coverage. People in their late-20s and early-30s, which are SoFi's member base, often start to look at life insurance options when they buy a home and start families.

"It's a sweet spot for our customers," said Blankmeyer.

Blankmeyer said SoFi can offer $1 million instant-approval policies because of the quality of their customers. The SoFi customer base is young, high-earning, highly educated, and have good credit. Those kinds of clients make underwriting easier for insurance companies.

How much term life insurance costs varies greatly depending on age, lifestyle, medical history, family medical history length of coverage, and the amount of coverage.


As you can see in the chart below, the coverage level and health status play a big role in the quotes. The same goes for tobacco use and your age.

Here are examples that we ran through the SoFi quote calculator, with all candidates being 30-years-old and never having used tobacco, seeking a 20-year term policy:

Instant-approval  parameters for 30-year-old, non-smoker for 20-year term life policy 

Monthly premium
Massachusetts male in "good" health wanting a $500,000 term life policy  $41.28
Massachusetts male in "good" health wanting a $1 million term life policy $73.53
Massachusetts female in "good" health wanting a $500,000 term life policy $34.40
Massachusetts female in "good" health wanting a $1 million term life policy $60.63
Texas male in "very good" health wanting a $500,000 term life policy $28.81
Texas male in "very good" health wanting a $1 million term life policy $51.17
Texas female  in "very good" health wanting a $500,000 term life policy $21.93
Texas female in "very good" health wanting a $1 million term life policy $38.27

Who should apply for instant-approval term life insurance?

Instant-approval term life insurance is meant for healthy people who are young. So, if you're healthy and in your 20s or 30s, instant-approval life insurance can be an inexpensive way to get term life without going through a lengthy process.

If you're unhealthy or you're  over 40,  instant-approval life insurance is likely not available for you. You can find out for sure by going to one of the company's online quote generators. It will ask you to enter in information like date of birth and you'll quickly know whether you can continue or if it kicks you off to a regular term life insurance policy.

If you're looking at term life insurance policies, it could be worth your time to quickly enter in your information to see whether you're eligible for instant-access term life insurance.  If you can’t qualify for an instant policy, it doesn’t mean you can’t obtain life insurance elsewhere, just that you’ll likely need to go the traditional route and shop for a term or whole life policy that requires a medical exam.

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