A life insurance company wants to minimize their financial risk as much as possible. Younger applicants are healthier than middle-aged people or senior citizens. They will live longer than older people and have decades of life to pay insurance premiums. Young applicants also get more worth out of a life insurance policy in terms of cash value, benefits, and coverage customization.
If you are over the age of 65, this doesn’t mean that you can’t get life insurance. It just means that it will be more difficult and expensive to acquire. The older that you are, then the closer that you are to death, statistically speaking. Men usually live until 69, while most women live to be 71. Of course, people live longer nowadays. Yet, the longer that you live the more prone you are to the illnesses, diseases, mental impairment, and physical degradation that comes with advanced aging.
A life insurance company is more likely to pay out beneficiary payments for a senior citizen applicant much sooner than a younger applicant. However, there are many life insurance products and alternatives that senior citizen can apply for. They may be costly and/or offer diminished benefits packages.
Final Expense Insurance
One of the cheapest ways to have some sort of life insurance is to have a final expense insurance policy. These policies can provide a policy payout from $1,000 up to $50,000. However, most people get enough to cover their burial and minimal expenses.
What is great about final expense insurance is the monthly premiums are inexpensive. Generally, less than $50 per month and there is no medical exam on most of these policies. This gives a family a sense of security and takes the worry and stress away from the family having to have the burden of paying the bills.
Term Life Insurance
This is a life insurance product that provides coverage within a predetermined term. Term life insurance is usually offered in increasing increments of 5-year terms. You can buy a term life insurance policy for 5-years, 15-years, 20-years, and so on. If you bought a policy for 10-years, then the coverage would only be active within that 10-year window of time. Term life insurance policies are affordable and offer the kinds of benefits that you will find in traditional life insurance policies.
The amount of premium that you pay should not increase for the life of the policy. However, term life insurance’s greatest benefit can also be its drawback. If you choose a 10-year window of coverage, for example, then you must die sometime within that predetermined 10-year coverage window for your beneficiaries to receive benefits. If you were to die 10 years and one day after buying the policy, your beneficiaries get nothing.
Outliving predetermined term life coverage windows means that you must buy another policy all over again. You may be able to extend term coverage or convert it, but that will cost more. Term life insurance coverage is affordable but is also a gamble.
Universal Life Insurance
This is a form of life insurance coverage is risky, expensive, and may depreciate in cash value in unpredictable fashion. If you have money to spare and are financially savvy when it comes to investing, then it may be right for you. Universal life insurance offers lifelong coverage. It also accumulates cash value over time. However, what you pay in premium may fluctuate over time. The cash value inherent in universal life insurance coverage is pegged to stock market performance.
The cash value of your policy is based on and tied to investments made on behalf of the carrier. If the investments tied to the policy underperform, then you might have to pay a higher premium to keep it from being canceled. You can borrow against the cash value of the policy. If you die before repaying, the loan amount will be deducted from beneficiary payments. If the investments tied to the policy perform well, then the policy gains accordingly in value.
Talk To a Professional
If you are 65 and over, don’t apply for life insurance coverage on a whim. Talk to a financial advisor, insurance agent, or broker. Consider your options. You can get life insurance coverage. It just might not be entirely on your terms.