The Best Life Insurance for Seniors of 2023
The top choices we have made for senior life insurance policies are as follows:
- Penn Mutual
- Protective
- Equitable
- Pacific Life
- Transamerica
- Midland National
How Does Senior Life Insurance Work?
People 65 years of age and older are usually covered by senior life insurance. The death benefit may assist beneficiaries in covering costs like:
- burial expenses
- Medical expenses
- Remaining debts, like credit card bills or auto payments
If your spouse is dependent on your pension and you do not receive survivor benefits, having senior life insurance in place during your later years will also safeguard their finances.
A life insurance policy can also be a means of leaving an inheritance for your offspring, grandchildren, or other loved ones.
A life insurance policy that includes a rider for a critical illness, chronic illness, or long-term care insurance can pay out while you’re still living. Riders like these can safeguard your savings if your condition satisfies the eligibility requirements.
Seniors still have the option to purchase life insurance despite the fact that life insurance rates rise with age. As you get older, you might still be able to find whole life or term life insurance at a reasonable price.
Burial insurance, sometimes known as funeral insurance or final expense insurance, is a resource that frugal seniors may use. Usually with modest coverage amounts, these whole life insurance policies are intended primarily to pay for funeral expenses and other parting costs.
A medical exam is usually not necessary for burial insurance, and you are usually not denied coverage.
Depending on your age, you might also be able to find senior term life insurance with a short duration, like 10 or 15 years.
Do Seniors Need Life Insurance?
Seniors who want to leave an inheritance or support their surviving loved ones financially must purchase life insurance. If you’re a senior considering purchasing life insurance, be aware that your rates will be higher than those of a younger person and that you might have trouble passing the life insurance medical exam if you have health problems.
Is There an Age Limit to Buy Life Insurance?
Seniors purchasing life insurance have the same options for policies as everyone else. Term, whole, and universal life insurance are all included in this.
- Although the length of the level term period available will get shorter, especially as you enter your late 50s, term life insurance is often available through age 80. For instance, 10-year term life insurance will probably be your longest option when you’re 80 years old.
- Certain companies offer cash value life insurance policies, like whole life and universal life insurance, up until the age of 85; however, some insurers have lower maximum ages. As one ages, the monthly premiums for cash value life insurance may become prohibitive.
- Guaranteed issue life insurance is available up to age 90, though coverage will probably only go up to a low maximum of $10,000. It will also be expensive.
How to Get the Best Senior Life Insurance
Your choice of life insurance options should be based on the reasons behind your decision to purchase senior life insurance. These pointers are for seniors looking to purchase life insurance.
Avoid Graded Death Benefit Life Insurance
Having life insurance that pays the entire death benefit right away is preferable. As a result, you should think about getting a regular life insurance policy rather than a “senior policy” with graduated death benefits.
In the first two or three years of owning a graded death benefit policy, your beneficiaries won’t receive the full death benefit if you pass away from a non-accidental cause.
Don’t Be Rushed into a Life Insurance Purchase
Seniors are a common target for financial predators. They might make an attempt to persuade you to buy more expensive or needless coverage. Anyone who pushes you to decide quickly or discourages you from talking to a family member or trusted advisor about a proposed policy should be avoided.
Don’t Be Sold on Policy Projections That Aren’t Guaranteed
“Policy illustrations,” which display estimates for expenses and cash value over time, are a feature of life insurance policies with the ability to accrue cash value. It is not always the case that the amounts displayed in an illustration are guaranteed for all cash value policies.
“Require quotes to include year-by-year cost disclosure, also known as policy accounting pages or detailed expense pages,” advises Flagg. Consult a counselor who will outline the guarantees and non-guaranteeds.
Get Professional Help
It is especially crucial to work with a qualified life insurance advisor who can assist you in comparing policies from various insurance companies, as seniors are more likely to have health issues.
To find the best possible rate for you, your advisor should examine your medical history and make informal, anonymous inquiries to a number of insurance providers. You can avoid application denials and save time by conducting anonymous inquiries.
Don’t Base Your Decision Solely on Cost
While cost is an important consideration when selecting a life insurance policy, you shouldn’t make your choice solely based on price. Examine the insurers’ financial strength ratings, such as those provided by AM Best.
Examine the life insurance riders available for the plans you are thinking about purchasing. Riders on your life insurance let you increase your coverage. Certain riders, like long-term care riders and accelerated death benefits for chronic or terminal illnesses, allow you to access your death benefit while you’re still alive if certain conditions are met.
You can obtain quotes to identify the ideal senior life insurance policy once you feel at ease with a list of insurance providers.
Is There Life Insurance for Seniors With No Medical Exam?
Seniors can easily obtain life insurance without a medical exam, but because of their advanced age and the absence of a medical exam, it is typically very expensive. Choices consist of:
- Guaranteed issue life insurance: There is no medical exam required and you cannot be denied coverage. For seniors, it may be their only remaining option for leaving a small inheritance or for life insurance to cover last-minute costs.
- Burial insurance: Typically, burial insurance is a small whole life policy, ranging from $5,000 to $25,000, that is designed to solely pay for funeral expenses. There might be a few health questions, or it might be a form of guaranteed issue life insurance with no medical questions. For burial insurance, a medical exam is typically not required.
How Much Does Life Insurance for Seniors Cost?
Here are term life insurance quotes from the companies in our analysis for seniors who are 70 years of age or older. Purchasing 20-year term life insurance may be challenging for buyers over the age of 70, and finding a 30-year term life insurance policy may be impossible.
What to Look for in a Senior Life Insurance Policy
As you get older and accumulate other assets, your need for life insurance will typically decline. The main reason you need life insurance is to ensure that someone who depends on you for financial support gets paid. Your need for life insurance may vanish if the assets you leave to your heirs will be adequate after your death.
Seniors may require life insurance for the following reasons:
- Final costs. To conclude an estate, pay for the funeral and associated costs.
inheritance. Apart from the assets in your estate, finance an inheritance.
The state of liquidity. Give an estate, consisting primarily of illiquid assets like real estate, liquidity. - replacement of income. When your primary source of income is a pension or annuity with little to no survivor benefits, you should continue to provide for your spouse or other dependents.
- Debts: Give survivors money to settle substantial bills.
- estate duties. Set aside money to cover heirs’ possible estate tax obligations.
- child with special needs. Set aside money in a special needs trust for a dependent who requires ongoing financial assistance.
- donation to a charity. Give a one-time gift to a non-profit organization in lieu of continuing to support it financially.
Alternative Life Insurance Options for Seniors
Seniors may have few options when it comes to term life insurance. Finding an insurer to provide you with a 20- or 30-year term life policy will probably be difficult.
Here are a few options to consider if you’re having problems locating a policy.
Guaranteed Issue Life Insurance
A certain problem There are no health-related questions or physical exams needed to apply for a life insurance policy. A policy is guaranteed for you. This means that an elderly person or someone in poor health can choose these.
The cost of guaranteed life insurance is one of its drawbacks. Another is that the death benefit amounts are typically modest, ranging from $10,000 to $25,000. However, you may want to consider the guaranteed issue option if you’re having problems locating a policy.
Be advised that the death benefit on guaranteed issue life insurance is typically graded. This implies that unless an accident results in death, beneficiaries will not get the entire policy payout unless the policy has been in effect for at least two or three years prior to the beneficiary’s death.
Simplified Issue Life Insurance
simplified problem A medical exam is not necessary for life insurance, but you will usually be asked a number of health-related questions. The insurance company considers these inquiries when determining whether to offer you coverage.
Although simplified issue policies are more expensive than fully underwritten standard policies, they can be a convenient way to obtain life insurance because they don’t require a medical exam.
Methodology
We compared term and permanent life insurance to determine which was best for seniors.
- We utilized data from AccuQuote, a nationwide online life insurance provider, in addition to our own research for our analysis of term life insurance. With more than 30 years of experience, AccuQuote exclusively partners with top-tier insurance providers.
- We used data from Veralytic, an independent publisher of life insurance research and analytics, for our cash value life insurance analysis. Veralytic can give your financial advisor a personalized policy analysis and evaluates how competitively priced permanent life insurance is.
Our ratings are based on:
Cost competitiveness of cash value policies (30% of score): This gauges how much seniors pay in internal policy charges and premiums, which include insurance costs, fixed administrative costs, and wrap fees based on cash value.
Reliability of policy illustrations (30% of score): We assessed the company’s illustrations for senior policyholders regarding permanent life insurance products for their consistency over time.
Term life insurance rates (20% score): We looked at rates for 10-year term life with coverage of $500,000 and $1 million for healthy buyers at age 70.
Historical performance (10% of score): This gauges how well the company’s investments, which support the growth of cash value, have performed historically.
Financial strength (10% of score): AM Best, Fitch, Moody’s, and Standard and Poor’s are the four main rating agencies that the insurer has its financial strength ratings incorporated into this measure.