Are you a senior over 70 years old looking for life insurance? Does it feel like everywhere you look, the policies are for younger generations, mostly up to 50 to 60 years old?
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What happens when you turn 70? Are you not allowed to have life insurance any longer?
Does this sound like you? Do you feel like life insurance for those over 70 is impossible? Don’t worry; you aren’t alone.
Many elderly parents ages 70 years old and up still want life insurance coverage. Whether you want it to leave an inheritance for your children and grandchildren, you want protection for your spouse, or to offset estate taxes for your beneficiaries, there are plenty of reasons to consider life insurance for seniors.
Here’s the problem. Few companies offer life insurance at this age, and if they do, the premiums are obscure. So now what?
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Table of Content
Your Life Insurance Options
You probably wonder what options you have in your senior years. Is term life insurance right? Is whole life insurance better? Will you get approved for either policy?
We know it’s confusing, but we’re here to help you understand your life insurance for the elderly over 70.
Term life insurance is suitable for a specific amount of time. Term life insurance provides a death benefit for your beneficiaries, such as your spouse or children. Waiting to buy term life insurance until you are over 70 is a pricey decision, but it’s better than nothing.
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For example, $100,000 of coverage for a healthy 70-year old male costs around $90 per month for a 10-year term. If you’re lucky enough to find a 20-year policy, your premiums increase to $125 per month. These rates are about half of the cost of whole life insurance rates, but they expire at the end of your term.
If you’re in good health, take a few medications, and need a small amount of coverage to protect your loved ones, consider term life insurance for seniors over 70. Many agencies offer terms up to 10 years for ages 70 and older. Without medical issues, your premiums will only increase due to your advanced age, not your health.
How to Get Term Life Insurance for Seniors?
If you’re in your golden years and in excellent health, apply for term life insurance policies with an insurance broker. He’ll find you the best deals, as he works with agents that cater to different demographics. Don’t shop your big-name agencies – they’ll either turn you down or charge much higher premiums than necessary.
Let’s figure out the pros and cons of term life insurance at 70:
- Fixed coverage for a fixed term
- Lower premiums than whole life insurance
- Has fixed premiums for the term
- May be harder to find, as many agencies don’t insure seniors
- If you outlive the term, you must either renew at higher premiums or go without coverage
Whole life insurance is good for your whole life, which sounds better, right? But the premiums are much higher. That’s because you pay into your death benefit and your policy’s cash value.
Since you’re starting at an advanced age, time isn’t on your side.
Don’t be disheartened, though! 🙂
Many people use the cash value of their life insurance to pay for college, cover future premiums, or supplement retirement income. Those aren’t real when you buy your policy at 70 or older. Cash value accumulation takes a long time. Since you’re already older, your focus shouldn’t be on the cash value but on the time the policy lasts (forever).
Whole life insurance for seniors over 70 is helpful in two areas: 1) final expenses and 2) reducing estate taxes.
Final expenses are the costs your loved ones endure when you die. They include your funeral and your final medical bills, and any remaining debts you left behind. Final expense insurance is a permanent policy with limits up to $50,000 in most cases, which is plenty to cover your final expenses.
If you’re a high net worth individual, you may want whole life insurance to offset the inheritance taxes your loved ones will have when you die. If your estate is worth more than $11,580,000, your loved ones face steep taxes of up to 40%. Your permanent life insurance policy can offset those taxes, giving your loved ones more of your estate and less to the government. This is a good option for life insurance for parents over 70.
As a 70-year-old parent, whole life insurance has a few variations that may suit your age.
- Simplified Whole Life Insurance
Are you worried about passing the medical exam? If an insurance company already turned you down or you know you have medical issues, a simplified whole-life policy may be better.
You don’t have to undergo a medical exam, but you answer a few specific questions about your health. Your answers determine your eligibility and premiums. Simplified whole life insurance premiums are higher than traditional whole life but less costly than guaranteed whole life insurance.
- Guaranteed Acceptance Life Insurance
Do you have serious medical issues? Would any insurance company turn you down? Guaranteed whole life insurance is your best option. Anyone qualifies for this policy because there are no medical exams or questions.
You pay much higher premiums and have lower coverage amounts but get coverage that you otherwise wouldn’t get if you didn’t have a policy with no medical exam life insurance for seniors. The exact premium increase depends on your age and your answers to the medical questions. You may generally pay as much as 75% – 100% more for no medical exam life insurance at 70.
Let’s dig deep:
When we say ‘no medical exam,’ we mean no paramedical exam. It helps to understand what it entails so you can decide if paying the higher premiums for no exam is worth it.
A paramedical exam is a quick overview of your health. A technician or nurse comes to you (or you go to them). They ask specific health questions about your current health and health history. They take a few drops of blood and a urine sample, and you’re on your way.
The technician or nurse evaluates your test results, and the insurance company pulls your Medical Information Bureau information and your prescription records. They use all this information to decide if you’re eligible for life insurance.
How to Get Whole Life Insurance as a Senior?
Think about what you want out of your whole life insurance. Are you looking for final expense coverage? Do you need guaranteed life insurance? Are you trying to leave a legacy or offset inheritance taxes? The answer to these questions will help you choose the best life insurance for seniors over 70.
Find an insurance broker that works with seniors over age 70 to find insurance products that are affordable and beneficial for your situation.
- This policy doesn’t expire
- Simplified Issue or Guaranteed whole life insurance has fewer requirements
- It sets up your loved ones to pay for your final expenses, cover inheritance taxes, or pay off your debts
- Whole life insurance premiums are much higher than term life insurance premiums
- You may have to shop around to find a policy with no waiting period (instant coverage)
Lowering your Premiums for Life Insurance as a Senior
No matter what type of insurance you choose, your advanced age means higher premiums, but you can control how high they get.
If you’re wondering:
Life insurance companies base your premiums on your likelihood of falling ill and dying. If you have certain habits, such as smoking or drinking, you increase your risks and, therefore, your insurance premiums.
If you’re overweight or just don’t take care of your health, it may show in your medical exam, resulting in higher rates. If you want an underwritten policy, you’ll want to be in the best health possible. Insurance companies look back over the last 12 months, so make sure you start ‘shaping up’ long before applying for a policy.
If you’ve done everything you can, the only other way to lower your policies is to choose less coverage. While not ideal, it helps keep your costs down.
What Kind of Life Insurance Should you Choose?
Your decision comes down to what you need.
Are you looking for a policy to cover yourself for a short time? Are you worried about your loved ones if you die within the next 10 years?
Are you looking for a policy that leaves enough money for final expenses or helps offset your beneficiaries’ inheritance taxes?
This is important:
Consider your health. Could you pass a medical exam? If so, choose underwritten life insurance – you’ll get the lowest rates and the best coverage. If your advanced age created medical issues for you, don’t give up. There are policies for you; they just cost more.
Think about what you can afford. If you have to choose a simplified issue or guaranteed life insurance policy, consider lowering your coverage amount. Choose a more affordable option, knowing you’re sticking within your budget and leaving your loved ones with something.
Life insurance is essential at any age. Considering life insurance if you’re 70 or older and have no insurance and enough savings to help your family upon your death.
Shop around to find the policy you can best afford. Don’t jump at the first advertisement you see; look to see what they offer. Take inventory of your life; consider getting healthier by quitting poor habits and eating right. You’ll increase your chances of approval and lower your premiums during this critical time in your life.