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While purchasing life insurance at a younger age is generally more advantageous, there can still be benefits to buying life insurance at an advanced age.

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It is an opportunity to leave a legacy for your family, pay for final expenses, or supplement retirement income.

Sometimes, you can set up a life insurance plan to manage your final outstanding debts, so your family won’t be burdened. If this advantage is your priority, the policy payout should be enough to cover credit cards, medical costs, and a mortgage.

Advantages of Having Life Insurance as an Older Adult

For most families, life insurance is more for the people you leave behind than yourself. Although you receive peace of mind knowing that a payout will cover final expenses and potentially offer enough to improve living standards, you, as the policyholder, won’t usually see that money.

That’s why all life insurance products are highly individualized. You’re working to meet your family’s specific needs with this investment.

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Reviewing all the potential advantages of having life insurance as an older adult ensures you’re investing in a policy that makes sense for your current and future needs. 

1. Help Pay Estate Taxes

Estate taxes can be a significant burden for individuals with an extensive net worth.

If an older adult has a sizable estate, life insurance can help to cover the costs of the tax burden, ensuring that their heirs receive the total value of their inheritance.

The payout doesn’t come with tax responsibilities in most jurisdictions, but specific rules could apply to your family situation. You’ll want to consult with a tax advisor to maximize this benefit.

2. Charitable Giving

A life insurance policy is a helpful tool for those with philanthropic ideas. Older adults often enjoy supporting charities and non-profits by naming them as beneficiaries as policyholders. This option is a meaningful way to continue helping a great cause even after your family starts managing the estate.

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3. Pay for Final Expenses

Life insurance can cover final expenses, such as funeral and burial costs. This benefit is particularly helpful for older adults who may need more financial means to cover these costs out of pocket.

The average cost of a natural burial plot is about $3,000. If you prefer a traditional funeral with a viewing, you’ll pay another $4,800 for those services in the United States. Cremation is slightly cheaper but still adds another $3,900 to the bill.

Some families don’t have the means to drop that kind of money unexpectedly. Older adults can find life insurance products that manage these specific expenses to have an affordable way to protect everyone’s finances.

4. Provide for Dependents

While many older adults may not have young children who depend on them financially, they may have other dependents, such as a spouse or adult children with disabilities. 

Life insurance can help provide for these individuals after the policyholder’s death, ensuring they are not financially burdened.

5. Guaranteed Acceptance Options

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Obtaining life insurance coverage can be challenging for older adults with health issues. Some policies offer guaranteed acceptance, meaning the policyholder does not have to undergo a medical exam or answer health-related questions. 

This option can be a significant benefit for older adults who may have pre-existing health conditions. In most circumstances, it allows them to access life insurance benefits without a significantly high monthly premium.

6. Wealth Transfer

A grandparent can purchase a life insurance policy for their grandchildren with the intention that the policy will provide funds for the grandchildren’s education or other expenses. It is a tax-efficient way to transfer wealth from one family member to another while providing more financial options for future generations.

Should I Pair My Life Insurance Policy with an Annuity?

While life insurance companies often sell annuities, they are not technically considered life insurance. 

An annuity is a financial product that provides a guaranteed income stream in exchange for a lump-sum payment or a series of payments. It is a contract between you and the insurance company, with the latter promising to pay a specific amount over one’s lifetime.

Annuities are often used as a retirement income strategy and can provide a reliable source of payments during retirement years. It is more of a supplemental option than a term or whole life insurance policy.

Although life insurance is often associated with younger individuals and families, it has several benefits for older adults. Whether you supplement it with an annuity or look for other policies that reflect your needs, there is a plan that can take care of everyone right now and still fit within your budget.


Meet Aaron H., a senior life insurance agent from California with 15+ years of experience. With a major in finance, excellent analytical and communication skills, and a passion for helping clients find personalized solutions, Aaron is a trusted advisor in the industry. He stays up-to-date on the latest trends and developments by attending webinars and workshops, reading industry blogs, and writing informative blog posts on this website. Aaron also has a keen understanding of SEO and online marketing, which he uses to help his clients reach a wider audience and get the coverage they need. He cherishes spending quality time with his wife, two children, and elder parents.