Even if you are at the age of retirement, it is never too late to get a life insurance policy. Life insurance can not only pay for your final expenses, but you can use some insurance policies as an income if you live past a certain age. There are several kinds of life insurance, but some policies may be better for seniors.
Whole Life Insurance
Whole life insurance may be one of the best life insurance plans for seniors. The insurance coverage and payments remain the same throughout your life. In many whole life plans, coverage can continue for some time even if you stop making payments.
There are several kinds of whole life insurance. Universal life insurance uses the premiums in an investment account that accrues interest. If you stop making payments, the account will make payments for as long as money is available in the investment account, so coverage can continue. Variable life insurance is similar. The amount of coverage can increase or decrease depending on the performance of the investment account.
Term Life Insurance
Term life insurance may be the most straightforward type of life insurance, but it has some considerations for seniors over 65. In term life insurance, you pay a premium for a term, and you will be covered during that term. This type of insurance can have excellent benefits for you or your beneficiaries. When the term ends, you must renew to keep your coverage. As you get older, the renewal amount increases, which can make it a more expensive option for seniors seeking life insurance coverage.
Level term insurance and decreasing term insurance are types of term life insurance. In level term life insurance, the benefit stays the same no matter when it is used. For example, a $100,000 policy will pay out that amount even if used early in the term. Decreasing term life insurance pays decreasing amounts for each year of the term.
Guaranteed Life Insurance
Guaranteed life insurance does not require a medical exam to obtain and it can be a good option for seniors who may want some additional security for their beneficiaries. Typically, guaranteed life insurance can accrue benefits the longer you hold the policy.
Guaranteed life insurance can be a combination of whole life and term life insurance, which is why it is sometimes called “term of life” insurance. This insurance may be easier for some seniors to get if other companies have turned them down for life insurance.
There are a few additional types of life insurance that might be available to seniors. Endowment life insurance can pay you an amount or a recurring income if you live past a certain age, but if you pass before reaching that age, it pays a sum to your beneficiary. Funeral, or pre-need insurance, is usually purchased from funeral homes to pay for the costs of the funeral and other final expenses. A life insurance agent can discuss your options with you to help you make a decision.