Along with protecting a spouse and family financially, seniors can use life insurance for many other reasons. Some are: to maximize retirement income, provide for a family business, provide for a special needs child or protect an estate from taxes. Yet getting life insurance when you are older is more complicated. Here are 3 secrets to consider when thinking about life insurance for seniors:#1. Why A Quote Engine is Not Your Best Friend
Lots of us start shopping these days by turning to our computers, so it might seem logical to start looking for life insurance by running an online quote. There are many sites offering you a free no-obligation quote (even our website!).
Unfortunately, for seniors an online quote engine is probably not going to be very helpful because insurance quote engines cannot consider all of the different medical issues one may have.
It is harder to get an accurate quote if you are 60+. Why? As we get older,most of us have more health issues such as:
- diabetes (although a quote engine may ask if you have diabetes, it cannot consider if it is well controlled or not.)
- heart conditions
- high blood pressure
- high cholesterol
- weight issues
To get the best quote on life insurance for seniors, you need to go to a carrier which has favorable underwriting policies for your age, health condition, and lifestyle. A search engine can't get enough information from you to point you to the best carrier, but an independent life insurance agent can. An independent agent has many companies that they can use to write your insurance. They should know which company is likely to give you the best rating. (The better your rating, the lower the premium!)
#2 Why Term Life Insurance may Not Be the Best Fit
Term life insurance is almost always the least expensive coverage for younger people and even middle age people. However, once you reach your 60's the price difference between term and permanent coverage is not that great. In fact, the gap shrinks every year until at about age 80, permanent coverage may be even cheaper than term.
What is best for you? It depends on your goals and your budget. Both play a part in figuring out which type of insurance and what amount of insurance makes the most sense. An independent life insurance agent specializes in helping you think through your options. They know what questions to ask to help you make these important decisions.
Life insurance is an important purchase for everyone. However, life insurance for seniors poses some additional challenges that are not as common in younger applicants. An independent life insurance agent is your best choice to help you through the life insurance investigation and application process.
#3 Why Guaranteed Premium Universal Life may be Better than Whole Life
Whole life insurance policies accumulate cash value. Did you know that if you borrow from the policy's cash value, the death benefit is reduced by the amount of the outstanding loan? However, if you don't borrow from it, your beneficiaries won't get the cash value anyway. Instead, the money will go to the insurance company to offset the cost of paying your beneficiaries. You might want to investigate a Guaranteed Premium Universal Life Policy which provides:
- lifetime coverage
- a premium that never changes
- a death benefit that doesn't change
- usually costs less than whole life (because it can be structured for no cash accumulation, it can cost significantly less)
Be aware that there are different options when it comes to life insurance policy types. Permanent policies are often very flexible and can be structured to suit your needs. For example, you can structure a permanent policy to provide insurance through age 121, but you only pay premiums for 10 years and then your policy is fully paid up. This is only one example of how flexibility in permanent coverage can be tailored to your personal situation and needs.
The Bottom Line
Life insurance for seniors isn't something you want to try to shop for on your own. Speak to an independent life insurance agent who specializes in working with people over age 50. They will be your guide to find the best insurance for you which meets your needs and fits your budget.