Why should I care?
A lot of people think that senior life insurance isn’t really that important especially when you’re above 80. That is not true as purchasing a policy should be a top priority for you. You should purchase one as soon as possible as putting it off may result in you paying more premiums.
Here is a list of why you should care for life insurance:
Funeral and Burial Expenses
Life insurance is of the best ways to cover for funeral and burial costs. Death is often unexpected, meaning the costs can become a sudden burden to your family and loved ones. It can be very hard to arrange for a funeral in short notices, given funerals cost anything between $7000 and $10, 000. This cost can easily go up if you have a large family attending.
With life insurance you don’t have to worry about your family taking loans or using up their hard earned savings. Based on your life insurance plan, they can receive an ample amount to cover your end of life expenses.
With the average age of first time American parents going up, there are chances your children are still young and may need money for college. With life insurance you can cover their college expenses.
Even if your children are grown up and independent, there may still be someone depending on you for income, maybe a disabled spouse or sibling or child. With life insurance you are guaranteed that they will be taken care of with the income from the insurance company should something happen to you.
If you own expansive homes and cars, transferring them to your heirs may become difficult as the high net worth results in enormous tax liabilities. With life insurance you can easily transfer your estate to your heirs without worrying about inheritance taxes. The proceeds from your life insurance policies can be used to offset estate taxes. A professional estate planner can better guide you if you have something like this in mind.
Peace of mind
The fact that you paying small premium amounts, depending on if your budget allows it, can result in your family being provided for on your death gives you peace of mind.
Important information you must know before going for a life insurance policy
This part talks about the different features of senior life insurance policies.
It is a misconception that insurance companies do not take people over 80. There are plenty of insurance companies that take clients over 90 so finding a life insurance for seniors over 80 isn’t that hard. Your age is one of the key factors that determine the cost of your premium.
The costs of insurance policies vary depending on the plan and coverage you go for. This depends on your needs and budget. You will have to think carefully about this one and look for plans that fit your requirements.
- Death Benefits
Depending on the insurance package you opt for, the death benefit can range from $5000 to $25000. If you want a higher death benefit you will have to pay higher premiums.
- Questions about Health
Depending on the type of insurance you go for, the insurance company may require you to fill out questionnaires about your health or may be take a medical exam or provide fitness and medical certificates as well. In some cases taking these medical exams may actuality save you money as policies that don’t require medical exams often cost more as the insurance company is taking on more risk. If you are not in good health avoiding it may be a good option, but it all ultimately depends on your health and medical history.
What are my options?
There are multiple types of insurance policies that you can opt for; the possible options are discussed below.
Should You Buy A Term Or Whole Policy?
Whole life insurance is a good idea for seniors over 80 as you will get cheaper premiums as compared to term life insurance. But again it depends on your needs and budget.
Term life insurance provides insurance for a specified time period, usually between 20 to 30 years. Mostly insurance companies offer coverage in increments of 5 or 10 years. Once this time period is over, you can continue with the insurance plan but usually at a higher premium.
If you go for a term life policy at 80, that last 10 years, it may difficult for you to get another one when you are 90.
Term life does offer less costly premiums as compared to whole life.
Whole life insurance will last till your death as long as you pay the premiums. It will accumulate cash value over the years that you can borrow from, the death benefits will be tax deferred and your family receives a lump sum on your death.
Is Burial insurance a good option?
Burial insurance, or final expense insurance or funeral insurance can be a good choice for life insurance for seniors over 80. It is designed specifically to pay for end of life expenses, like funeral and burial costs. Burial insurance is inexpensive, requires no medical exams and may offer as much as $20,000 in death benefit. It can offer a maximum of $2,000 is coverage, if you are above 80. If you want more, you can buy multiple policies from multiple companies, yes this is legal.
This may be the right life insurance for you, if you have health problems.
Is A Graded Life Insurance A Good Option?
This may be the right policy for you if your health isn’t in perfect condition or you are terminally ill. With this policy, if you pass away during the first few years of the policy, your beneficiaries only get the premiums you paid plus a little interest. Full coverage is only available after the policy has been in effect for a certain number of years. You can qualify for a plan with an interest rate between 4% and 10% if you are over 80.
Guaranteed Acceptance Life Insurance Over 80
This should be your last resort. So if no company talks you can go for this. Guaranteed life insurance involves no health questions, no medical exams, offers instant acceptance, but there’s a catch:
· More cost per month. Since these companies are taking a greater risk, they charge more.
· Low amount of death benefit.
This can be the right insurance for you if you have certain medical conditions.
How do I decide?
With all the different senior life insurance policies out there it can become difficult deciding the right one. It can be very tedious and seemingly impossible if you don’t know what you’re looking for. Here are a couple of things you need to keep in mind when deciding your insurance policy:
The life insurance company you opt for must be financially stable. If that is the case, there are very little chances of them not honoring their obligation when you need them to.
- The process for the application is simple, you can start it online, and you may need to deal with a representative in the future.
- Your policy is easily customizable; you can add additional riders based on your needs.
- The terms of the insurance policy are clear.
- Get help from an agent or broker. These people know a lot more and can match with the perfect insurance policy.
· The plan costs less than other plans from other insurance companies
List of senior life insurance companies
Here is a list of senior life insurance companies to help you get started with life insurance.
1. SentinelSecurity Life
With over 70 years of experience, Sentinel offers different types of insurance plans. They offer policies that are tailor made to fit their clients’ needs.
2. Royal Neighbors Of America
A fraternal organization, Royal Neighbors of America has an outstanding track record spanning over 120 years. It was among the first insurance companies that insured women and children. They offer different types of life insurance packages. They accept clients 85 and below.
AIG offers guaranteed issue life insurance, no medical questionnaires or assessments, they guarantee your acceptance. AIG has a two year waiting period before full death benefits are paid. If you pass away during the first 2 years, AIG pays you 110% of the premiums paid. They accept clients 85 and below.
It is available in all states except New York.
Aetna is among the few companies that accept new applicants aged 89, where 85 is generally the maximum age for most other insurance companies.
5. Liberty Bankers Life
Liberty Bankers Life offers burial insurance and has unique burial policies. They offer full benefits from day one to clients with emphysema, COPD, liver diseases, or kidney diseases. They are also among the few companies that offer plans to people as young as 18.They accept clients 85 and below.
6. American Amicable
American Amicable offers burial insurance policies to certain situations. They offer cheaper premiums to cigarette smokers. They have two no cost riders on most of their insurance plans. They accept clients 85 and below.
· Terminal Illness Accelerated Benefit Rider
If you are diagnosed with a terminal illness and have a life expectancy of 12 months, his may be 24 months in some states, you get 100% of your death benefit. This rider comes with every plan.
· Accelerated Benefits Rider- Confined Care
If you are confined to a nursing home 30 days after the policy is issued, you get a 5% of the face amount per month. There are some states where this rider is not applicable.
They also offer other riders a minimal extra premium.
· Accidental Death Rider
· Grandchild Rider
· Children’s Insurance Agreement
7. Prosperity Life Group
With a very simple application process that gets you accepted in 15 minutes, Prosperity Life Group accepts a lot of high risk health issues. They offer immediate coverage where other life insurance companies may require a 2 year waiting period. They apply a tobacco rating on only those who smoke cigarettes, non-cigarette smoking nicotine or tobacco users get a non-tobacco rating. They accept clients 85 and below.
It is available in all states except the following:
· North Dakota
· South Dakota
8. American Life Insurance
They offer burial insurance between ages 0 to 85; this age range may vary in some states. They require no medical exam but you need to pass a medical exam and a phone interview to be eligible.
They offer the following riders:
· Grandchild Rider
· Nursing Home waiver Premium Rider
· Optional Accidental Death Benefit Rider
· Terminal Illness Accelerated Benefit Rider
· Accelerated Benefits Rider