5 types of senior life insurance
Shopping for the right senior life insurance can be a daunting process. This is because, at the moment, there are many providers offering worthwhile coverage policies. However, before settling on an insurance company, you should first figure out which type of senior life insurance is best for you and your loved ones. Continue reading to know which are common coverage plans you can consider investing in.
As the name suggests, term insurance offers benefit for a certain time frame. The age limits for every insurance provider’s plan varies. Usually, the age limits and corresponding terms are as follows.
55 to 64 years old: 30-year term
65 to 69 years old: 25-year term
70 to 74 years old: 20-year term
75 to 79 years old: 15-year term
80 years old and above: 10-year term
It is important to note that the proposed term insurance premiums will increase according to one’s age. Likewise, the installments will be expensive, if the senior has some chronic health conditions. If the provider senses that senior’s medical issues might have severe circumstances in the near future, then they might even disapprove their application. The term life insurance with no health assessment might be comparatively costlier than the ones with medical underwriting.
Also known as permanent life insurance, this type of policy offers a death benefit for the rest of the insured’s life and at the same time, accumulates a cash value. The whole life insurance stays valid as long as the senior pays the premiums on time. The good part is that the premium amount stays uniform for the entire policy’s life. However, as compared to term plans, the premiums for permanent coverage are relatively pricey.
Guaranteed universal life insurance draws a few features from both, term and whole plans. They are more affordable than permanent life insurance. The length of such coverage can be chosen by the senior. However, in most cases, it outlives the senior’s lifetime. It is mostly used for funding end of life costs, offering an inheritance to the beneficiaries, and diminishing estate taxes.
This type of senior life insurance lasts a lifetime and has a cash value attached to it. The cash value is directly influenced by factors such as policy’s investment performance and the ability to take loans against it. Since the insurance directly involves the unpredictability of its investments, earnings are not assured. Likewise, the senior might have to increase the premium payments to sustain the policy’s performance.
Final expense insurance
As the name implies, the final expense insurance ensures funds for paying off medical bills and burial expenses. This permanent senior life insurance lasts a lifetime, and usually provides a coverage ranging between $50,000 and $100,000. This type of senior life insurance can help develop a cash value, i.e., you can access the money during the life of the plan.