What's the Best Life Insurance for Seniors? The Answer May Surprise You
What’s the Best Life Insurance for Seniors? Well now this is a terrific question and the answer might surprise you.
If you have been reading my blog for any period of time, then you know how much I like term life insurance products.
It’s super affordable, which means you can get more coverage for less money AND it protects you during your most vulnerable years.
From my perspective Term works for MOST people most of the time.
That said, seniors are most definitely the exception to this rule.
Find out why now!
Who Am I...and How Was This Blog Born?
My name is James Heidebrecht and I am the founder of Policy Architects. We are a small boutique life insurance company in Canada.
This blog really is a labour of love. Not all of us are happy plugging our personal details into an online tool. Who is receiving your personal details? How is the info being processed? For me all of these questions are important.
When you work with Policy Architects you get real info from a real person who enjoys the life insurance business.
This blog was meant to help people in the beginning phases of shopping for a policy – providing them with user friendly info BEFORE they speak to an agent.
This will save you time, money and frustration. So without further adieu let’s move on with the post.
What's the Best Life Insurance for Seniors? Your Age Matters
The life insurance industry is all about risk. The more risk an insurer takes on to cover you, the more your premiums will cost. So as you age, you get closer to death…which makes you a higher risk.
This is why it’s very important to know which life insurance birthdays are the most important. There are maximum ages for specific terms and even a maximum age to hold term coverage at all.
Clients come to me in their older years looking for protection… and I change my advice depending on their age.
For example a 50 year old may still be young enough to consider term coverage depending on their medical situation and financial needs.
That said a 60 year old really should consider permanent options. This is because:
- Term coverage becomes very expensive
- There are limits on the length of term
- There is no guaranteed payout at the end despite the outlay of cash.
Permanent Life Insurance Options
There are a number of options to consider when it comes to permanent coverage. As I have mentioned in past posts life insurance is a very individual product. Some people require millions in coverage, while others are only seeking small amounts.
Reasons for purchasing a life insurance policy also differ greatly. The type of insurance you select is directly impacted by your needs.
Many older clients come to see me because they are looking for final expense coverage. These plans typically have a face value of $5,000 – $25,000. The monies are earmarked to help their loved ones pay for funeral costs and wrap up final expenses.
For a situation like this, I would set them up with a small, affordable whole life policy. The good news is funeral insurance is affordable and super easy to apply for. Ninety-five per cent of all final expense coverage is sold as no medical life insurance which does not require a physical or medical exam. Also whenever possible, seniors should always purchase life insurance policies with no waiting period.
While others are wealthy and are looking to keep their estate intact. In a case such as this, there are many different options we could explore from a Guaranteed Universal Life Policy to different types of whole life with guaranteed and non-guaranteed cash values.
No matter what the situation – one thing holds true – I would likely direct them to a permanent policy at this juncture.
Whole life insurance is a way to make sure your beneficiaries will get a payout, no matter how long you live. There is no specific term length and you cannot outlive your policy, as long as you pay the premiums. A portion of your premiums go into a cash value account. You can borrow from it or withdraw cash. If you’re looking to provide life insurance funds for funeral expenses, whole life insurance is one way to do it.
What If I Am in Bad Health?
Traditional permanent life insurance coverage requires a medical exam. This is so the underwriters (people who make the decisions about your ratings which determine how much you pay for coverage) can assess your medical condition.
In your elder years, you run a higher risk of being rated (paying higher premiums) or declined because of your health.
So what if you are not in great shape and want to avoid a medical exam altogether. Well, I have some great news for you! Simplified issue life insurance allows you to answer a battery of questions to obtain coverage.
Now don’t get me wrong if you have serious medical issues you won’t qualify for this coverage – but don’t worry! Guaranteed-issue life insurance provides protection to anyone regardless of their previous diagnoses. There is a catch, however. Most Guaranteed issue policies come with a 2 year waiting period.
Wondering What's the Best Life Insurance for Seniors? Call Us TODAY!
If you are wondering what’s the best life insurance for seniors is then I can comfortably say a permanent policy is probably your best bet. Hey don’t get me wrong, there are always exceptions to the rule.
Like a 61 year old client who is in excellent health looking for short term coverage because they still have a little to pay on their mortgage. Maybe a 10 to 15-year term works for this situation…we would have to crunch the numbers.
BUT for the most part, if you are looking to protect your loved ones from final expense costs, want to leave a nest egg or simply want coverage that is guaranteed to payout…
…then a permanent policy is your best bet.
Call us or get a free quote from Policy Architects today. We work with the best no medical life insurance companies in Canada. Permanent insurance (unless you are talking about final expense) is a lot more expensive than its term counterpart so it’s good to do your due diligence.
There are all kinds of different products with or without cash value accumulation and investment options. You don’t want to embark on this path without some professional advice.