What Is The Maximum Term A Senior Can Choose For A Term Life Insurance Policy
If you are 60-years or over and contemplating term insurance, coverage is available to you up to your age of 85. Said differently, depending on your age, your choices are usually limited to 10-year, 20-year, or 25-year terms. As mentioned above, most insurance companies do not issue term policies to seniors once they cross the age of 75. For those above the age of 75, permanent coverage, such as term-100 or whole life coverage, is the only alternative.
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Best Whole Life Insurance For Seniors: Massmutual
Our proprietary rating methodology takes multiple factors into account, including customer satisfaction, cost, financial strength, and policy offerings. See the “methodology” section for more details.
AM Best rating
A.M. Best is a global credit rating agency that scores the financial strength of insurance companies on a scale from A++ to D .
Using a mix of internal and external rate data, we grade the cost of each insurance company’s premiums on a scale from least expensive to most expensive .
No option to skip the medical exam
For seniors in good health seeking more than $50,000 of whole life coverage, MassMutual is a reputable company that pays higher dividends to its cash value policyholders than most of its competitors.
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What Should Seniors Consider When Shopping For Life Insurance
First, think critically about your financial obligations. How would your loved ones pay for your final expenses? Is there any outstanding debt that you need covered? Are you more focused on estate planning and minimizing estate tax for your children?
Once youve determined how much coverage you actually need, you can start shopping around to apply with a company that has strong financial ratings. Its also important to apply with a company that is a good fit for your health profile, since some insurance companies calculate risk associated with various health conditions differently.
Most insurance companies want to see that seniors have a primary care physician, especially if they are applying for a term policy. If you’re above the age of 70 and dont have a doctor you see regularly, you may find it more difficult to qualify for a term policy.
Best For Full Death Benefits: New York Life
New York Life
Must speak with a financial professional to plan the policy
No estimate of monthly premiums available on their website
We chose New York Life as the best company for full death benefits because they offer policies that feature customizable options regarding your death benefits. They do so through their Universal Life policy with a guaranteed versus adjustable death benefit option, which has three other choices.
For example, you can opt for a death benefit that includes the face amount of the policy and the policys cash value. Another option consists of the adjusted total premiums you paid into the policy, plus the policys face value. They also offer a Chronic Care Rider, which allows you to tap into your death benefits on a tax-free basis should you experience a chronic illness .
Their Protection Up to Age 90 Universal Life policy option provides at least $1 million in coverage for those who need significant life insurance protection, which they advertise for senior business owners to protect their companies. They also offer a no-medical exam policy for AARP members that provides $10,000 to $100,000 to protect those up to age 80 .
New York Mutual offers its policies up to those who are 90 years of age. The company operates in all 50 states and Washington, D.C. They also have an A.M. Best rating of A++ , reflecting their financial stability and ability to pay out death benefits to their customers.
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The Immediate Financial Impact Of Premiums
Premiums for life insurance policies vary a great deal, and there are no one-size-fits-all prices. Age, health, and many other factors must be taken into account. That being said, for seniors, a term policy for $250,000 may start around $70, and premiums for lower death benefit amounts can be as low as $50 or less for young seniors. In some cases, Universal Life and variations thereof can be quite affordable or quite expensive, depending on exact policy features. Whole policies tend to be the most expensive, and premiums may easily be several hundred dollars per month unless the death benefit is low .
With premiums, its important to think ahead. If youre just turning 65, your rates will only go up if you wait to sign up. However, you dont want to rush yourself into a policy with a premium thats higher than you can truly afford month after month, year after year. If you reach a point where you can no longer afford your premium, you may be able to sell the policy to a third party or to surrender it to the company in exchange for a small cash value amount, but neither option is ideal. If you have doubts about being able to keep up with life insurance premiums, it may be best to devise a different plan for saving and/or investing a modest sum of money on a more flexible basis. Your financial planner should be able to help you decide whats best for your specific situation.
No Medical Exam Life Insurance For Seniors
Some people feel that because of their age or health they will not be approved for senior life insurance. But enhancements in insurance underwriting and the availability of specialty insurers who focus on covering those with higher risks means life insurance is available to almost everyone.
Once youve found a company and policy that meets your needs, you will be asked to fill out an application. To be approved for coverage, youll need to provide some personal information about yourself, such as your age, your height and weight, any health conditions you have, and any life insurance you already have. For some insurers, you may be asked to complete a medical exam to qualify.
For smaller policies, some companies offer life insurance without a medical exam. Final expense insurance for seniors is usually issued based on answers to health questions on the application. Its important to answer all questions honestly when filling out your application so your coverage can be issued accurately. Misrepresenting the truth can result in your policy being canceled or death benefits being denied if incorrect information was provided.
Guaranteed issue life insurance plans also exist, but these are often very expensive and may not fit most budgets.
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No Exam Life Insurance
No exam life insurance for seniors is the same as guaranteed issue coverage. Youll be able to secure life insurance regardless of your health, but youll only be able to get a small amount of coverage, and youll pay higher premiums as a result.
As an example, with guaranteed issue life insurance for seniors from Gerber Life, you can be accepted with an easy application process and no medical exam. You can buy coverage until youre 80 years old, and you dont even have to provide information on a health questionnaire.
But in the case of Gerber Lifes guaranteed issue life insurance policies, you can only buy up to $25,000 in coverage, which is a relatively small amount when it comes to life insurance. A policy like this is probably best used to cover your final expenses when youre gone.
Best For Final Expense: Mutual Of Omaha
No regular whole life option, only guaranteed issue
Mutual of Omaha is a good choice if you need a small permanent policy and have health problems. The company offers a guaranteed issue whole life policy with coverage up to $25,000. The policy requires no health questions and you can apply for it online without contacting an agent. However, the death benefit is graded for the first two years, which means that if you die of natural causes during that time, your beneficiaries wont receive the full death benefit. You must be between 45 and 85 years old to apply.
The company is rated A+ by AM Best, which means it has a superior ability to honor its insurance obligations, such as paying claims. Mutual of Omaha received fewer complaints than expected for a company of its size in 2021.
For more information, read our full Mutual of Omaha life insurance review.
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What Is The Best Type Of Life Insurance For Seniors
The best senior life insurance coverage is whichever policy option is both affordable and most appropriate to accomplish your goal.
Do not make the unfortunate blunder of shopping for a policy based purely on price.
If you only consider the cost, youll regret it in the future when you finally become aware of the details you missed because the price was your only focus.
What will my beneficiaries use the money for when I die
Only buy a term policy to cover a temporary need such as a mortgage, credit cards, or other debts. Or to replace your income if you have dependents who rely on you for financial support.
Buy permanent life insurance to cover a lifelong need such as funeral costs or estate planning.
One type of life insurance is not universally the best.
Choose the appropriate kind of policy that is best suited for your objectives.
How Seniors Can Get Life Insurance With No Waiting Period
Some senior life insurance options make you wait for two years before youre effectively insured.
If there is a waiting period, the insurer will only refund your premiums if you die during the first 24 months.
But many policies cover you 100% the day you make your first payment.
To qualify for a life insurance policy with no waiting period, you must apply with a company that asks questions about your health. You dont necessarily have to take an exam, but you must fill out a health questionnaire.
Remember, any policy with no health questions will always have a waiting period.
For example, AIG is a major carrier that sells guaranteed issue life insurance. It has a two-year waiting period, just like every other insurance company.
There is no such thing as no health questions and no waiting period .
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Best For Whole Life Policy: Penn Mutual
No online quote tool you must speak to a financial adviser
Medical exam may be required for whole life insurance
Penn Mutual offers two whole life insurance options with some unique payment features and potential riders. As a mutual fund company, Penn Mutual pays dividends to its policyholders. This can maximize your whole life policy because you have the potential to earn money in addition to your guaranteed interest rate associated with your policy.
Penn Mutual guarantees your premium rate, so you won’t have to worry that your premium will increase as you age. With this in mind, Penn Mutual offers an innovative payment option for whole life policyholders with their “Guaranteed Whole Life” policy: You can choose to pay off your policy’s value in as little as five years or spread the policy premium out up to when you reach age 100.
They also offer a “Survivorship Choice Whole Life” policy, a two-person policy that can help cover estate taxes or charitable gifts. The maximum issue age for this policy is age 85. We also liked Penn Mutual’s educational tools, particularly their available whole life riders. They would give scenarios where a particular rider may be helpful to add on, such as “building more cash value” or “protecting the policy if you are disabled.”
When Does The Policy Kick In
Different insurance companies have different guidelines that dictate when your policy will go into effect. For instance, some life insurance policies are effective immediately others wont pay the death benefit if you die in the first two years of your policy. Be sure to ask your insurance company about this important question before buying a policy.
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Is Senior Life Insurance Right For Me
Life insurance for over 50s works slightly differently from other types of life insurance such as level term, so here’s a quick summary:
- You are guaranteed to be accepted for a plan you won’t have to have answer health-related questions or have a medical examination when you apply
- You must be between 50 and 80 to apply
- The policy runs for the rest of your life, not just a set number of years
- You may be able to stop paying your monthly premiums at a set age say 90 or 95 depending on the provider, but still be covered under the plan
- The pay-out tends to be lower than other types of life insurance
- If you keep paying your premium, the benefit is guaranteed to pay out when you die unless you die during the initial waiting or moratorium period, which is usually one-two years.
If you’re not sure if this type of life insurance will suit you best, it might be helpful to speak to a financial advisor or get some quotes to help you understand your options. You’ll be able to see how much the different types of policy will cost and what cover and pay-outs are available.
Best Term Life Insurance Companies For Seniors
Each insurer has its own age cutoffs for term life insurance, meaning you may have to evaluate multiple companies to determine if you qualify. In addition, you may have trouble getting approved depending on the amount of coverage you want and your health.
You can only purchase a Banner term life insurance policy through age 75, but the insurer has some of the best rates available, even if you have some medical conditions. For example, Banner Life will accept common issues like mild asthma or sleep apnea. They will also give a discount if you regularly perform health-maintenance activities . Banners only restriction is that they dont offer medical exam life insurance for seniors.
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What Is Final Expense Insurance
Final expense insurance is a type of life insurance policy designed to cover the costs associated with end-of-life expenses such as funeral and burial costs.
Also referred to as burial insurance, it is typically purchased by seniors over the age of 50 who want to ensure that their loved ones are not burdened with these costs after they pass away.
When considering final expense insurance, it is important to understand both what it covers and how it works so you can make an informed decision about whether or not this type of policy is right for you and your family members living in Arkansas.
Final expense policies are almost always a form of permanent life insurance, or whole life insurance. With a whole life policy, you do not need to worry about outliving the life of your policy, as long as you make your premium payments.
Permanent coverage is ideal for final expense insurance because it is intended to help loved ones pay for costs associated with someone passing away.
Typically paid as a tax-free lump sum to beneficiaries, final expense policies help cover:
- Final medical bills.
- Flowers and obituary.
With final expense coverage in place, you can rest assured knowing that your loved ones will not have any additional financial stress during an already difficult time following your passing away.
Final expense insurance is an affordable way to help your loved ones cover the costs of a funeral, burial or cremation when you are no longer around.
Should You Consider Life Insurance After Retirement
While there is no simple way to answer this question, its always wise to consider your circumstances without forgetting about your familys future and livelihood. If your familys finances are in order and youve taken your household debt into consideration, you may only require a low level of life insurance cover, if you need it at all.
You may want to take out life insurance after retirement for a variety of reasons:
- Your family are dependent on your financial contributions to pay debts and living expenses.
- Your children require ongoing financial support due to medical needs or school/university fees.
- Your spouse or dependents would require financial assistance to cover funeral costs or legal fees.
- You want to give your family an inheritance to invest in their future.
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