Tuesday, February 19, 2013

75 Years Over Age Senior And Life Insurance

Individuals over age 75 have this sudden sense of mortality, we could only deduce that social pressures are the main factors. After all, seniors in that age group do not seem to particularly exhibit any more health issues, on average, than individuals ages 60 to 74 for example. In any case, the need is present and should addressed sooner than later.

What Plans Are Available?

Depending on their actual age, older individuals should have access to term as well as whole life insurance plans. For most, no exam plans should also be available. The decision to do term life instead of whole life should primarily rest on the length of time the coverage is needed. If the need is short then term is the way to go. If the need is long (15+ years) then, for that age group, we recommend a good whole life plan or maybe its cousin, universal life insurance.

Because of the lower premiums term life offers, it can be tempting to select this plan over whole life (even if long term coverage is needed). We strongly recommend that you do not do that as you will likely regret it later. You see, if you select a 10 year term plan and live past the 10 years, either the plan will end after the initial 10 year period or it will get so expensive that you will cancel it and realize that you should have selected the whole life. Although the amount of insurance should match your needs as closely as possible, in some situations, we may still recommend that you select a whole life policy with a low face amount rather than select a term life with higher coverage that may better meet your insurance needs.

For example, if your need is for long term, $40,000 in life insurance then a $40,000 should be what you get. The problem is, you may not be able to afford $40,000 in whole life an decide to do a more afford 10 year term instead. We feel that this may be a mistake simply because after the 10 year is up you will likely have no insurance at all. Consider a smaller $25,000 instead and maybe ad more whole life later as you can afford it.

Should you select an exam or no exam plan?

As far as doing a no exam or exam required plan, that depends on the amount of coverage you need and your aversion to an insurance exam. If your coverage need is very small (under $25,000), then don't bother with an exam and get a no exam simplified issue whole life (term is not available at that age without an exam). If your need is above $25,000, then a plan that requires an exam may be a better choice. Assuming that you qualify, doing an exam may cut your rates by 30% to 50%+. It could be well worth it. Also, if you are willing to do an exam, you may have more plan choices than without an exam.

What if you have health issues?

Needing life insurance and having health issues when you are over age 75 is not the same as when you are much younger. Believe it or not, some health issues at older ages are not as much of an issue as when you are, say, under 50. Depending on your health issues some plans may or may not be available.
If you have been turned down for traditional plans then you may want to consider simplified issue whole life insurance. With many of these plans, no exam is required and very few health questions need opt be answered. Some companies may do additional checks such as MIB, pharmacy report… but most people can qualify. Be careful that you do understand the policy you are applying for as some have delayed benefits for two to three years. These polices are not necessarily a bad choice but you and your loved ones need to be aware that the death benefit may be graded or modified and thus may not fully take effect right away (except for accidental with some).

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