life insurance for senior
it is never too late to consider purchasing a senior life insurance policy or expanding your existing coverage. A common misconception for adults over 50 is that life insurance for seniors can be either too expensive or impossible to obtain. However, purchasing an affordable senior life insurance plan if you’re over 50, over 60, or even later in life might be easier than you think. No matter your age, the most important thing is finding the best options for your financial situation and stage of life.
Life Insurance Over 50
If you are over 50 and don’t have any coverage at all, or need to increase your coverage for a period of time, take a look at term life insurance policies first. Term coverage offers traditional life insurance benefits with customizable policy options. Your monthly premiums remain locked in place at a predetermined rate for the entire length of the term you purchase. Term policies are typically sold for fixed periods of time between 10 and 30 years in length. This can be helpful for those with continuing obligations, such as a mortgage or college costs, but looking for an affordable monthly payment that they can budget for.
Another life insurance plan that may appeal to people over 50 is to convert an existing term policy to permanent. If you elect to purchase a convertible policy, you may be able to convert to a permanent policy with no medical exam or need to prove insurability. This type of flexibility could be helpful as your needs change over time. It is important to note that your premium may increase when and if you do elect to convert your policy to permanent coverage. If you purchase a convertible policy, be sure to find out how long of a window you have in which to convert the policy to a permanent one after purchase. Convertibility is possible only during the time agreed to by you and your insurer in your contract.
Are you concerned that your loved ones might be burdened with the costs of your medical bills and other living expenses if you become seriously ill? If so, you may want to consider a type of life insurance coverage called Quality of Life Insurance. Offered by American General Life Insurance Company, QoL offers innovative “living benefits” that (in some cases) can provide you with paid policy benefits while you are still alive. It is important to understand how living benefits work before choosing this type of policy. But for adults over 50, this life insurance can provide additional peace of mind.
Senior Life Insurance Over 60
Sometimes, financial situations can change rapidly for people over 60. Unexpected medical bills, cost of living expenses, and changes in business ownership are only a few reasons. Because of this, some people who start out with a term life insurance policy decide to change their coverage to a Universal Life Insurance policy. With a universal life policy, you may be able to decrease or increase your death benefit to help meet your needs as they change. Universal Life Insurance also has the added benefit of interest-earning cash value. This means that your policy increases in value over time. Even better: your universal life policy taxes are deferred. This means that in many cases you won’t pay annual taxes on your policy. It also means that your beneficiary typically will not have to pay income tax on the income they receive from your policy.
Life Insurance for Seniors Over 70
Some older adults over 60, 70 or even 80 years of age, are looking for a smaller coverage amount, enough to cover final expenses such as burial costs or to pay off bills. If so, Guaranteed Issue Whole Life Insurance coverage (or Life Insurance for Elderly) may be the best fit for you. Sometimes known as senior life insurance, burial insurance or final expense insurance, these policies typically range in coverage amounts from $5,000-$25,000. Guaranteed Issue Whole Life Insurance coverage was designed specifically to meet the needs of adults ages 50-85. With guaranteed acceptance, no medical exam, and up to $25,000 in coverage, this senior life insurance policy offers a guaranteed way to help protect their legacy. Guaranteed Issue Whole Life benefits can help your loved ones pay for medical bills and final expenses. This can alleviate stress on your family helping to enable them to resolve your outstanding financial matters in your absence.
No matter your age or needs, purchasing a policy as young as possible can help provide security for your family. And remember, with many types of policies, typically the younger you are when you purchase, the less your costs will be. Don’t delay, you may want to consider getting get a senior life insurance policy soon!
5 Best Life Insurance Policies for Seniors
Life insurance for those in their 50s or 60s may be more expensive than a policy for someone younger—say in their 30s. However, there are still plenty of choices available to you. The right choice of a life insurance policy will depend on what you want it to do for you. There are several types of life insurance policies to choose from, and here is a brief run-down of some of the types and what they do for you.
Term Life Insurance: Term life insurance is available in terms of a specific number of years (usually available in increments of five years ranging from 10- to 30-year terms). Term life insurance tends to be more affordable than other types of life insurance, such as whole life insurance and is ideal for seniors who are in relatively good health and want an affordable premium. The premiums remain consistent throughout the term of the policy. If you die during the policy term, your beneficiaries would receive the death benefit of the value of your policy. However, should you die after the term expires, your beneficiaries do not receive a death benefit? Some term life insurance policies have the option to convert to a whole life insurance policy at the end of the policy term, so that is an option to consider.
Guaranteed Universal Life Insurance: Guaranteed universal life insurance offers a guaranteed death benefit similar to whole life insurance, but has premiums that are more affordable than a whole life policy. You can choose the age you want the coverage to end or you can continue the policy to last your entire lifetime. Premiums are consistent throughout the life of the policy. The guaranteed life policy may be ideal for seniors who want to leave a legacy to beneficiaries and to help pay for final expenses but who are also on a budget and seeking a more affordable life insurance premium.
Whole Life Insurance: Whole life insurance is just as it sounds—it lasts for your whole life. Premiums remain the same each year, and the policy pays out a death benefit after you die to your beneficiaries. There is another attractive feature of many whole life insurance policies in that there is a cash value you can borrow against to help pay for things such as health expenses for a major illness. Whole life insurance is more expensive than term life and guaranteed universal life, but there is more comprehensive coverage. One thing to keep in mind, if you borrow against the value of the policy, your death benefit is reduced by the amount of the loan.
Universal Life Insurance: Universal life is a lifetime policy that accumulates a cash value. The cash value available is based on the performance of investments. If the investments underperform, your insurance premium could increase. You can borrow against the policy, but any outstanding loan will be deducted from the death benefit. This policy is more of a risk than the other types of life insurance policies for seniors and is also more expensive. However, if the investments do well, you can build up a significant cash value. For seniors looking to invest, it could be an option to consider.
Final Expense Insurance: Final expense insurance is a way to give your loved one’s peace of mind. The death benefit can be used to cover the cost of any final medical expenses and funeral costs. The final expense policy is available in a wide range of terms, from as low as a $5,000 benefit to a $50,000 benefit. Almost anyone can qualify to purchase a final expense insurance policy regardless of age or health.
Keep in mind what your goal for having a life insurance policy is when making comparisons of available life insurance policies for seniors. We did some research and came up with these five life insurance policies as some of the best choices available to seniors.
Best Term Life Insurance for Seniors:
The term life insurance policy from New York Life is available in terms of five to 20 years and is also a policy that accumulates cash value. If you decide you want to extend your coverage, you have the option to convert to a permanent life insurance policy once the policy term ends. The death benefit is tax-free. You can add coverage to a term life policy from New York Life by adding riders for accidental death, children’s insurance, chronic care, disability waiver of premium, and living benefits.
This term life insurance offers affordable premiums and has many policy options available to seniors.
Best Guaranteed Universal Life Insurance for Seniors:
The guaranteed universal life insurance policy from Mutual of Omaha offers cash value accumulation and flexibility. You can adjust your premium payments and increase the death benefit amount. The death benefit is tax-free, and you can also access a portion of your death benefits if you have a chronic or terminal illness. The death benefit is guaranteed either for a specific amount of time you chose or for your entire lifetime.
Best Whole Life Insurance for Seniors:
The whole life insurance policy offered by MassMutual offers a guaranteed death benefit for your entire lifetime. There is a cash value that accumulates and can be accessed at times when you need it most, such as for a supplemental retirement income, medical expenses, or other emergencies. Even though the MassMutual policy does not guarantee dividends, the company has paid out dividends to policyholders who are elected every year since 1969, so you may get the benefit of receiving dividend payments without having to purchase a policy designed to pay dividends on investment returns.
Best Universal Life Insurance for Seniors:
John Hancock’s universal life insurance policy offers lifetime protection and grows in cash accumulation value. You can customize both the frequency and amount of payments, so it is an excellent choice for seniors seeking a universal life insurance policy with flexible payments. The cash value grows based on a credited interest rate return on investments and can change. You can borrow against your death benefit, and any outstanding loan will be deducted from the death benefit if the loan is not paid back before you die.
Best Final Expense Insurance for Seniors:
Transamerica offers three final expense policies for seniors: immediate policy, 10-pay policy, and easy policy. The policy can be paid for in full or over terms of 10 payments. There is no waiting period for coverage to begin, and the premium does not increase as you grow older. You may qualify for a final expense insurance policy through Transamerica regardless of age and health conditions. Policies are available for individuals up to age 85. There are no medical exams required, and there are optional riders to add coverage which vary based on your state of residence.