Quick Tip: Fill out the form on the side for an instant quote on life insurance from companies who will collaterally assign a life insurance policy for your SBA loan.
Summary: (1) Use a no-exam or accelerated underwriting program. (2) Work with an agent who will accelerate the collateral assignment recording. (3) Don’t wait until the last minute.
Most business owners who contact us for life insurance required for their SBA loan are nearing the end of the approval process and it’s one of the final requirements to receive their money. So getting coverage in force quickly is important.
Here are 3 ways to speed up the process for an SBA loan:
Use “No Exam” or “Accelerated Underwriting” Programs
Since the life insurance process can take 60-90 days in some cases, seeing if you can qualify for a fast issue policy is important.
There is a difference between a “no exam” program and an “accelerated underwriting” program.
A no exam life insurance policy can be issued immediately or within 48 hours. It’s an accept or reject basis and is more expensive than a fully underwritten policy. Most companies will do a max of $250,000 – $500,000 of coverage. If your SBA loan is for more than that, you can buy multiple policies. This is the fastest way to get a life insurance policy in force.
An accelerated underwriting program may or may not issue you coverage without an exam. They’ll pull you MIB, pharmacy and motor vehicle report and determine if you need an exam or not. If you don’t need an exam, a policy can be issued within a week. However, if you do need an exam it will take 4-8 weeks on average for an approval. This is the most affordable way to get a “no exam” policy in force and many can get you coverage for up to $1,000,000. Like no exam policies, you can always purchase multiple policies if your SBA loan amount is higher.
The first thing we do for our clients trying to secure coverage for an SBA loan is to see which of our 60+ companies will approve them for no-exam or accelerated underwriting programs.
Accelerate the Collateral Assignment
After you’re approved for a life insurance policy, your lender will need an executed collateral assignment.
We provide you with the collateral assignment immediately upon approval so you can get to work on getting it signed (and often times notarized). This is one way we speed up the process.
The second way we speed up the process is rushing the recording of the collateral assignment. After you send back the collateral assignment, it can take weeks for the life insurance company to record it. Most life insurance agents just wait for the company to handle it, we don’t. We are calling and placing a rush on it and can typically get your collateral assignment recording completed within 3-10 business days depending on the company.
So just know that getting approved for a policy doesn’t mean you’re close to being done. The collateral assignment can hold things up and it’s important to get it taken care of.
Get Your Life Insurance Requirement Taken Care of NOW
Most business owners who contact us need the life insurance requirement taken care of “yesterday”. It’s typically the last requirement for the SBA loan to be in good order and sent to funding.
We’re good under pressure and if you’re in good health can acquire coverage for you quickly, but if you’re in poor health the process can take a lot longer.
So just be proactive and if you’re reading this article – get it taken care of now.
We work with SBA borrowers every day and know how important this life insurance requirement is to get your funding. Since 2013, we’ve ONLY dealt with SBA borrowers and know the nuances inside and out of this process. We know what companies are the fastest in underwriting, recording collateral assignments and are connected with specialty programs for those who are getting declined for coverage to get them coverage.
Whatever curveball comes our way, we’ve seen it and we’ll make sure we knock it out of the park for you and get you coverage quickly to satisfy your SBA loan requirement.