Benefits of getting life insurance for seniors
Here are some ways life insurance can help seniors:
Provide financial security for your loved ones
The life insurance death benefit offers financial security to your loved ones in case you pass away. They can use the death benefit to replace their income and supplement their assets while paying down outstanding debts.
Enjoy reasonable premiums
Although premiums rise with age, the life insurance market has grown more competitive.2 This has caused insurers to reduce costs to attract new policyholders — even for more traditional policies. On top of that, there are plenty of policy types with reasonable premiums for seniors. For instance, smaller policies like final expense and simplified issue life insurance also have lower premiums, given their lower coverage. Furthermore, shopping around can help you find and compare quotes to get rates that fit your budget.
Customize coverage to meet your needs
Senior life insurance lets you customize many parts of your policy. You can select different types of policies and adjust the death benefit to your needs. If it’s a term life insurance policy, you can select from many term lengths as well.
Additionally, you can add riders for specific types of extra coverage that are either free or come with an extra cost. For example, an inflation rider can increase your death benefit each year to keep up with inflation and help your beneficiaries receive a bigger payout.
Enhance your estate planning
Life insurance may allow you to pass more assets down while avoiding estate taxes if you place the policy in an irrevocable life insurance trust (ILIT) managed by a trustee of your choice. The ILIT owns the policy instead of you, so the death benefit may not be counted as part of your estate. When you pass away, the trustee you selected pays the death benefit to your chosen beneficiaries.
Keep in mind that you must avoid any incident ownership in the policy to gain the tax benefit.3 Also, you can’t undo the trust after you create it. Therefore, you must be certain that you want to use the policy for this purpose.
Life insurance rates for seniors over 60
Below are the average monthly premiums for a $250,000 term life insurance policy, assuming the policyholder is in good health:4
Age Gender Premiums 60 Female $62.60 Male $82.70 70 Female $173.39 Male $245.01
Here are the average rates for a whole life insurance policy for seniors in good health with a $100,000 coverage amount:
Age Gender Premiums 60 Female $324.50 Male $394.50 70 Female $580.80 Male $652.00
How seniors over 60 can get a life insurance policy
Here’s how seniors over 60 can get life insurance coverage:
- 1. Evaluate your coverage needs: Consider your income, expenses, and dependents to determine how much coverage you need and are willing to pay for.
- 2. Understand policy types: Determine whether you need lifelong coverage and an additional wealth-building vehicle via a cash value growth component. This will help you pick between term and permanent life policies. Finally, decide if you’re willing to take a medical exam or not.
- 3. Gather quotes: Get quotes from multiple insurers to compare coverage amounts, rates, and potential terms. Review each insurer’s reputation as well.
- 4. Begin the application: You’ll provide some personal information, such as age, occupation, and hobbies. You’ll also most likely answer some basic health questions. Finally, you’ll schedule a medical exam if needed.
- 5. Take the medical exam if applicable: If your policy requires an exam, you may take the exam in your home or at the facility. The examiner will gather health data and take samples, such as blood tests.
- 6. Get approved: Approval can take as little as a day for no-exam policies but may take longer for policies with an exam. Either way, the insurer will eventually present you with your policy documents.
- 7. Review documents and sign the contract: Look over the paperwork to make sure you understand every aspect, such as premiums, death benefits, cash value, and any riders. Ask questions and bring up concerns if necessary. If everything looks right, sign the documents and pay your first premium to activate coverage.
Get a quote for Aflac life insurance
Seniors have plenty of life insurance options, whether they need simple, low-rate coverage or a lifelong policy with wealth-building potential. Premiums may be higher than for younger policyholders, but a competitive market and range of policy types make it easier to find favorable rates on coverage tailored to your needs.
Ready to explore your options for covering your loved ones and leaving a larger legacy with life insurance? Chat with an Aflac agent today to explore your options, ask any questions you may have, and get a quote.
