As we grow older, we may start to consider what will happen to our loved ones when we’re no longer around. This is where life insurance comes in. Life insurance provides a financial safety net for your beneficiaries in the event of your passing. However, finding the right life insurance policy as a senior can be a bit more challenging than it is for younger individuals.
In this article, we’ll explore the best life insurance options for seniors, including the different types of insurance available, the factors to consider when choosing a policy, the best companies to work with, and how to apply for coverage.
By the end of this article, you’ll have the information you need to make an informed decision about your life insurance needs.
What is life insurance?
Life insurance is a contract between an individual and an insurance company in which the policyholder pays a premium in exchange for the insurance company’s promise to pay a sum of money to their beneficiaries upon the policyholder’s death. The purpose of life insurance is to provide financial protection for the policyholder’s loved ones in the event of their death. The beneficiaries can use the death benefit to pay for funeral expenses, and outstanding debts, or to provide financial support for dependents.
Why life insurance may be important for seniors.
Life insurance can be important for seniors for several reasons. One of the main reasons is to provide financial protection for their loved ones in the event of their death. Seniors may have outstanding debts, such as a mortgage or credit card balances, that they want to ensure are paid off after they pass away. They may also want to leave a financial legacy to their loved ones or provide income replacement for a surviving spouse or dependent.
Additionally, seniors may want to ensure that their final expenses, such as funeral costs and medical bills, are covered without creating a financial burden for their family. Life insurance can also be used to provide a charitable donation or to pay estate taxes.
Another reason life insurance may be important for seniors is that it can help them qualify for long-term care benefits (or living benefits). Some long-term care policies require applicants to meet certain health requirements, and life insurance can help bridge the gap for those who don’t qualify. Seniors can also use life insurance as an asset to pay for long-term care expenses.
In summary, life insurance can provide peace of mind for seniors by ensuring that their loved ones are taken care of financially after their passing, and it can also provide additional benefits such as covering final expenses and helping to pay for long-term care.
Types of life insurance
There are three main types of life insurance: term life insurance and permanent life insurance and final expense or guaranteed issue life insurance. Each type of insurance has its own features and benefits, and seniors should consider their individual needs when choosing the best option.
Term Life Insurance:
Term life insurance provides coverage for a specific period of time, such as 10, 20, or 30 years. If the policyholder passes away during the term of the policy, the beneficiaries receive a death benefit. If the policyholder outlives the term of the policy, the coverage ends, and there is no cash value. Term life insurance premiums are typically lower than permanent life insurance premiums.
Pros:
- Lower premiums
- Flexible coverage periods
- Provides coverage for a specific need, such as paying off a mortgage or providing income replacement until retirement
Cons:
- Coverage ends at the end of the term
- No cash value accumulation
Permanent Life Insurance or whole life insurance:
Permanent life insurance provides coverage for the policyholder’s lifetime and includes a savings component that accumulates cash value over time. This cash value can be borrowed against or withdrawn, and it can also be used to pay future premiums. Permanent life insurance policies come in several forms, including whole life, universal life, and variable life insurance.
Pros:
- Coverage for life
- Cash value accumulation
- Can be used as an investment tool
Cons:
- Higher premiums than term life insurance
- More complex than term life insurance
- May not be necessary for all seniors
Guaranteed Issue Life Insurance:
Guaranteed issue life insurance is a type of life insurance that is available to seniors without requiring a medical exam or answering any health questions. Because there is no underwriting process, premiums are typically higher, and coverage amounts may be lower.
Pros:
- Guaranteed approval regardless of health status
- No medical exam required
- Provides coverage for final expenses
Cons:
- Higher premiums
- Lower coverage amounts
- Graded death benefit (waiting period before full coverage is in force).
- Not as much flexibility as other types of life insurance
Factors to consider when choosing life insurance for seniors
When choosing life insurance for seniors, there are several factors to consider:
- Age: The older a person gets, the more difficult it may be to obtain life insurance, especially if they have health issues. Some insurance companies may limit coverage or charge higher premiums for seniors.
- Health: Seniors should consider their health when choosing life insurance. If they have a pre-existing medical condition, they may need to choose a policy with higher premiums or limited coverage.
- Coverage amount: Seniors should determine how much coverage they need based on their financial obligations, such as paying off a mortgage, providing for their spouse or children, or covering final expenses.
- Premiums: Seniors should consider their budget and how much they can afford to pay in premiums. Term life insurance typically has lower premiums than permanent life insurance, making it a more affordable option for seniors on a tight budget.
- Other financial considerations: Seniors should consider how life insurance fits into their overall financial plan, including retirement savings, investments, and estate planning.
- Budget: Seniors should choose a life insurance policy that fits within their budget. They should consider how much they can afford to pay in premiums and whether they can maintain those payments over time.
By considering these factors, seniors can make an informed decision about which type of life insurance policy is best for their needs and financial situation. It’s also important to work with a financial advisor or insurance agent who can provide guidance and help find the best policy for their needs.
Term Life Insurance Rates for Seniors
Each of the sample life insurance quotes are from top rated life insurance companies. Each quote is for a preferred best or preferred plus rate class.
Sample term life insurance rates are for informational purposes only, are subject to change, and must be qualified for.
Best Life Insurance Rates Ages 50-59
Best Life Insurance Rates Ages 60-69
Best Life Insurance Rates Ages 70-79
Final Expense Insurance Rates
Sample final expense insurance rates for seniors from A- rated carriers and better. Rates are for informational purposes only and must be qualified for.
$25,000 Burial Life Insurance Rates ages 50-59
All whole life rates shown below are fixed and will stay the same for your lifetime.
| Age | Level | Graded | Guaranteed Issue |
|---|---|---|---|
| 50 | 64.80 | 82.09 | 108.85 |
| 51 | 67.83 | 84.41 | 117.10 |
| 52 | 71.06 | 89.02 | 124.67 |
| 53 | 74.48 | 93.65 | 131.77 |
| 54 | 78.05 | 98.28 | 137.96 |
| 55 | 81.55 | 102.91 | 143.46 |
| 56 | 85.36 | 107.55 | 147.58 |
| 57 | 89.33 | 112.16 | 151.25 |
| 58 | 93.07 | 119.11 | 154.46 |
| 59 | 96.97 | 126.06 | 156.75 |
$25,000 Final Expense Life Insurance Rates ages 60-69
All whole life quotes shown below are guaranteed to stay the same for your lifetime.
| Age | Level | Graded | Guaranteed Issue |
|---|---|---|---|
| 60 | 101.54 | 132.98 | 158.35 |
| 61 | 106.15 | 139.93 | 170.04 |
| 62 | 111.28 | 146.88 | 181.04 |
| 63 | 117.09 | 156.12 | 191.58 |
| 64 | 123.56 | 165.39 | 201.67 |
| 65 | 130.03 | 176.97 | 211.52 |
| 66 | 137.54 | 188.53 | 220.23 |
| 67 | 144.40 | 200.11 | 227.79 |
| 68 | 152.17 | 213.99 | 234.89 |
| 69 | 159.55 | 230.18 | 241.08 |
$25,000 Burial Insurance Rates ages 70-79
All whole life insurance quotes shown below are guaranteed to stay the same for your lifetime.
| Age | Level | Graded | Guaranteed Issue |
|---|---|---|---|
| 60 | 169.94 | 246.58 | 246.58 |
| 61 | 180.33 | 267.26 | 269.04 |
| 62 | 191.72 | 288.64 | 291.04 |
| 63 | 204.11 | 310.64 | 311.67 |
| 64 | 217.56 | 333.74 | 330.92 |
| 65 | 232.07 | 357.39 | 347.42 |
| 66 | 262.79 | 386.10 | 405.85 |
| 67 | 280.53 | 422.84 | 462.00 |
| 68 | 300.53 | 462.44 | 515.85 |
| 69 | 319.00 | 501.25 | 567.41 |
$25,000 Final Expense Insurance Quotes ages 80-85
All whole life insurance rates shown below are fixed for life and will not increase.
| Age | Level | Graded | Guaranteed Issue |
|---|---|---|---|
| 80 | 344.52 | 534.58 | 616.91 |
| 81 | 370.06 | 579.04 | 691.74 |
| 82 | 395.61 | 608.96 | 711.84 |
| 83 | 422.75 | 636.24 | 788.61 |
| 84 | 449.90 | 660.44 | 826.87 |
| 85 | 477.04 | 669.79 | 865.38 |
Top life insurance companies for seniors
(rates may differ based on individual differences).
When choosing a life insurance company for seniors, it’s important to consider factors such as financial stability, customer service, and the types of policies offered. Here are three top life insurance companies for seniors, along with an overview of their pros and cons and sample rates:
- AIG: AIG is a global insurance company that offers a variety of life insurance policies, including term life, guaranteed issue, and whole life insurance. AIG has strong financial ratings and a reputation for excellent customer service. However, its premiums may be higher than some other companies, especially for seniors with health issues.
Sample rates: A 65-year-old male non-smoker in good health can get a 20-year term life insurance policy with a $100,000 death benefit for around $49 per month.
- Mutual of Omaha: Mutual of Omaha is a mutual insurance company that has been in business for over 100 years. It offers a variety of life insurance policies, including term life, whole life, and guaranteed issue. Mutual of Omaha has strong financial ratings and a reputation for excellent customer service. However, its premiums may be higher than some other companies, especially for seniors with health issues.
Sample rates: A 70-year-old male non-smoker in good health can get a 10-year term life insurance policy with a $50,000 death benefit for around $77 per month.
- New York Life: New York Life is a mutual insurance company that has been in business for over 175 years. It offers a variety of life insurance policies, including term life, whole life, and guaranteed issue. New York Life has strong financial ratings and a reputation for excellent customer service. However, its premiums may be higher than some other companies, especially for seniors with health issues.
Sample rates: A 75-year-old male non-smoker in good health can get a 10-year term life insurance policy with a $50,000 death benefit for around $138 per month.
It’s important to shop around and compare rates from several insurance companies to find the best policy for your individual needs and budget. Additionally, seniors should consider working with a financial advisor or insurance agent who can provide guidance and help find the best policy for their needs.
Which Type of Insurance is Best for Seniors?
The best type of life insurance for seniors depends on their individual needs and financial situation. Here are some factors to consider when choosing between term life insurance, permanent life insurance, and guaranteed issue life insurance:
- Coverage needs: Seniors should consider how much coverage they need and for how long. If they only need coverage for a specific period of time, such as paying off a mortgage or providing income replacement until retirement, term life insurance may be the best option. If they want coverage for life and the ability to accumulate cash value over time, permanent life insurance may be a better fit.
- Premiums: Seniors should consider their budget and how much they can afford to pay in premiums. Term life insurance typically has lower premiums than permanent life insurance, making it a more affordable option for seniors on a tight budget.
- Health: Seniors who have health issues may have difficulty qualifying for traditional life insurance policies. In these cases, guaranteed issue life insurance may be the only option. However, these policies typically have higher premiums and lower coverage amounts.
- Estate planning: Seniors who have significant assets or estates may want to consider using life insurance as part of their estate planning strategy. In these cases, permanent life insurance may be a better fit, as it can provide coverage for life and accumulate cash value that can be used to pay estate taxes or provide an inheritance for beneficiaries.
Ultimately, seniors should carefully consider their financial goals and talk to a financial advisor or insurance agent to determine which type of life insurance is best for them.
Final thoughts…
Seniors have several options for life insurance, including term life insurance, permanent life insurance, and guaranteed issue life insurance. The best type of insurance for seniors depends on their individual financial situation and goals. When choosing a policy, factors such as age, health, coverage amount, and premiums should be considered.
Regardless of the type of policy, life insurance is important for seniors who have dependents or outstanding debts, as it can provide financial protection for their loved ones after they pass away. Additionally, life insurance can be used to pay for final expenses, such as funeral costs.
Overall, it’s important for seniors to carefully consider their options and choose a life insurance policy that meets their unique needs and goals. And while all of this might seem a bit much, the good news is all you need to do is give us a call, we’re here to help and make everything easy!
Frequently Asked Questions
What is life insurance?
Life insurance is a contract between an individual and an insurance company, in which the insurer promises to pay a designated beneficiary a sum of money upon the insured’s death. The purpose of life insurance is to provide financial protection for loved ones in the event of the insured’s death, especially if the insured is the primary provider or has outstanding debts. Life insurance can also be used to pay for final expenses, such as funeral costs. There are different types of life insurance policies, including term life insurance and permanent life insurance, which offer different levels of coverage and benefits.
Do seniors need life insurance?
Whether or not seniors need life insurance depends on their individual circumstances. If a senior has dependents who rely on their income, such as a spouse or children, or if they have outstanding debts, such as a mortgage or loans, life insurance can provide financial protection for their loved ones after they pass away. Additionally, life insurance can be used to pay for final expenses, such as funeral costs. However, if a senior does not have dependents or debts and has enough savings to cover their final expenses, they may not need life insurance. Ultimately, the decision to purchase life insurance as a senior should be based on individual financial goals and needs.
How much does life insurance cost for seniors?
The cost of life insurance for seniors can vary depending on several factors, including the type of policy, the amount of coverage, the age and health of the individual, and the insurance company. In general, life insurance premiums tend to increase as an individual gets older and their health declines.
Term life insurance is typically the most affordable option for seniors, with premiums ranging from around $20 to $200 per month, depending on the coverage amount and age of the individual. Permanent life insurance, such as whole life or universal life insurance, tends to be more expensive, with premiums ranging from around $50 to $500 or more per month.
Guaranteed issue life insurance, which is designed for seniors who may have difficulty obtaining coverage due to health issues, can be more expensive, with premiums ranging from around $50 to $500 per month or more.
It’s important to shop around and compare quotes from different insurance companies to find the best rates and coverage options for individual needs and budget.
Can seniors with pre-existing conditions get life insurance?
Seniors with pre-existing conditions may be able to get life insurance, but the availability and cost of coverage can vary depending on the specific condition and its severity. Insurance companies generally consider a variety of factors when determining eligibility for coverage, including an individual’s age, health status, and lifestyle.
Some pre-existing conditions may result in higher premiums or exclusions from coverage, while others may make it difficult to obtain coverage altogether. However, there are some insurance companies that specialize in providing coverage for individuals with pre-existing conditions, and working with an experienced insurance agent can help seniors find the best coverage options available.
It’s important for seniors with pre-existing conditions to disclose their medical history accurately and completely during the application process, as failing to do so could result in a denied claim or cancellation of coverage in the future.
What are the benefits of life insurance for seniors?
There are several benefits of life insurance for seniors, including:
- Providing financial support for loved ones: If a senior has dependents who rely on their income, such as a spouse or children, life insurance can provide financial support for them after the senior passes away. The death benefit from a life insurance policy can be used to cover expenses such as living expenses, college tuition, or mortgage payments.
- Paying for final expenses: Life insurance can also be used to cover final expenses, such as funeral costs, which can help ease the burden on surviving family members.
- Leaving a legacy: Life insurance can be used to leave a financial legacy for loved ones or to support charitable causes that are important to the senior.
- Peace of mind: Knowing that loved ones will be taken care of after the senior passes away can provide peace of mind and reduce stress and anxiety.
Overall, life insurance can provide seniors with financial security and peace of mind, making it a valuable investment for those with dependents or financial obligations.
What is the difference between term life insurance and permanent life insurance?
The main difference between term life insurance and permanent life insurance is the length of coverage and the premiums.
Term life insurance provides coverage for a specific period, usually 10, 20, or 30 years, and the premiums are generally lower than those of permanent life insurance. If the policyholder dies during the term, the beneficiaries receive the death benefit. However, if the policyholder outlives the term, the coverage ends and there is no payout.
Permanent life insurance, on the other hand, provides coverage for the policyholder’s entire life, as long as the premiums are paid. There are several types of permanent life insurance, including whole life, universal life, and variable life insurance. The premiums for permanent life insurance are generally higher than those for term life insurance because the policyholder is guaranteed coverage for their entire life, and the policy also has a cash value component that can grow over time.
Overall, the choice between term life insurance and permanent life insurance depends on the individual’s needs and budget. If the goal is to provide coverage for a specific period of time, term life insurance may be the better option. However, if the goal is to provide long-term coverage and have a savings component, permanent life insurance may be the better choice.
How much life insurance coverage do seniors need?
The amount of life insurance coverage that seniors need depends on several factors, including their age, health, financial obligations, and goals.
One commonly used method for calculating life insurance coverage is to multiply the policyholder’s income by 10. For example, if a senior earns $50,000 per year, they may want to consider purchasing a policy with a $500,000 death benefit. This calculation is based on the assumption that the death benefit will provide enough income replacement for the beneficiaries to maintain their standard of living.
However, this method may not be appropriate for everyone. Seniors with significant financial obligations, such as mortgages or debts, may need a higher death benefit to ensure that these obligations can be paid off if they pass away. Additionally, seniors who want to leave a legacy or provide for their heirs may want to purchase a policy with a higher death benefit.
Ultimately, the amount of life insurance coverage that seniors need will depend on their unique circumstances and financial goals. It’s a good idea to speak with a financial advisor or insurance agent to determine the appropriate amount of coverage for your specific situation.
What is guaranteed issue life insurance?
Guaranteed issue life insurance is a type of life insurance policy that is available to individuals regardless of their health status or medical history. Unlike traditional life insurance policies, guaranteed issue policies do not require a medical exam or health questionnaire. As long as the individual meets the age requirements and pays the premiums, they are guaranteed to be approved for coverage.
One of the main benefits of guaranteed issue life insurance is that it provides coverage for individuals who may not qualify for traditional life insurance due to pre-existing medical conditions or other health issues. However, guaranteed issue policies may have higher premiums and lower death benefits than traditional life insurance policies, since the insurance company is taking on more risk by insuring individuals without knowledge of their health status. Guaranteed issue life insurance policies also contain a graded death benefit which will limit when the policy begins to provide coverage for natural causes of death.
Guaranteed issue life insurance can be a good option for seniors who are unable to qualify for traditional life insurance, but still want to provide their beneficiaries with some financial support after they pass away. It’s important to carefully review the policy terms and compare quotes from different insurers before purchasing a guaranteed issue policy to ensure that it meets your needs and budget.
