Older Seniors Buying Life Insurance Products
Can you believe how many seniors do not have a life insurance policy
?Why don't seniors have life insurance? It makes a lot of sense as a part of many people's financial planning for their golden years. Well, lots of younger people do buy a policy, but then lose it over the years. They may have had a 10 or 20 year temporary policy that expired. Others had a group plan through work, but then left that employer or retired. There are lots of reasons that older people do not have coverage, but this does not mean they could ot use that coverage. Some reasons could be to pay for a funeral, settle debts, pass on money to kids, or even to take care of some business obligations. Plenty of older people find a reason to purchase a policy
Anyway, it really does not matter why. What matters is that many seniors still would like to buy life insurance policies. There is some very good news too. Many insurers are responding to this demand with products that are senior friendly. Many old people, in their seventies, and maybe even early 80's, can find a policy that has been designed for them. Prices will be higher than they would be for a 40 year old applicant, but there are still ways to find affordable coverage.
For one thing, insurance companies check into credit reports these days, and use that information to factor into their rates. Older people are more likely to have good credit, and a long history of financial responsibility. Mortgages may be paid off, or close to being paid off, so debt is less. In addition to good credit, more mature people have often developed good health habits. Following a doctor's orders, they may quit smoking and watch their weight. These factors can help with insurance company rates too!
And finally, an older person may not need as large of a policy as they did when they were youger. At 40, a person is probably still concerned about paying off a mortgage and educating chidren. When these obligations are handled, the older person may only need a smaller amount of coverage. So it will be cheaper to buy a smaller face value policy than a big one! Many seniors only want to purchase ten or twenty thousand dollars worth of coverage. This will be much cheaper than 100 or 200 thousand dollars worth!
Term life insurance is popular with younger families because it usually has the lowest monthly premiums. However and older person who is looking for a smaller face value policy will usually buy a permanent policy like whole life or universal life. This type of life insurance, in addition to providing a death benefit, can also build a cash value. So it can be more than a life insurance policy, but also a savings vehicle, and an asset that can be borrowed against or cashed in should the need arise. Some retired people will even sell their life insurance policy, before they die, to a life settlement company. They can use the cash to meet their needs while they are still alive.
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