Life Insurance for Seniors

Life insurance is an important part of overall financial planning both for new investors and seniors. As people age, one key goal for many is to ensure that loved ones are taken care of financially should the unexpected occur.

Life insurance is also one of the most important purchases that you’ll ever purchase for your family. It’s the best way to ensure that you don’t leave your loved ones with a massive amount of debt and unpaid expenses. Not having life insurance could put your family in a difficult situation if something tragic were to happen to you.

There are millions of seniors that assume that they no longer need a life insurance policy, but that could be a bad idea. Other seniors assume that they can’t qualify for a life insurance plan, or that one of these plans are going to be too expensive for them to afford.

There are many life insurance policy options for seniors today that can provide affordable coverage to meet a wide variety of different needs. Prior to shopping for life insurance, seniors should have an idea of their specific needs, as well as what types of plans are available for them.

Why Seniors Need Life Insurance

Life insurance for seniors can serve numerous needs. First, proceeds may be used to help a surviving spouse or other loved ones in paying rent or mortgage, as well as for other everyday ongoing living expenses.

The benefits of life insurance can also be used for paying off:

  • Final expenses such as a funeral and burial costs
  • A future college fund for children or grandchildren
  • Donating funds to a favorite charity
  • Setting up a trust for a loved one with special needs

One of the biggest reasons that many seniors purchase life insurance is for the paying of estate taxes. These taxes are levied on the transfer of one’s “taxable estate” at death – and in some instances can be in excess of half the entire estate value. Having a life insurance policy in place can help to alleviate the burden on heirs of paying estate taxes, while providing a larger percentage of the actual estate to pass on to loved ones.

Types of Life Insurance

There are two primary classes of life insurance. These are term and permanent. Term life insurance is the most basic form of coverage on the market. In return for paying a regular premium, term insurance provides a set amount of death benefit, provided that the insured passes away within the time period – or term – of the policy’s duration.

Term life insurance does not include any type of cash value or investment component. Uses for this type of coverage typically include covering short-term debt obligations, or those debts with a specific time frame such as the payoff of a mortgage.

Permanent life insurance provides death benefit protection along with a cash value build-up that is allowed to grow on a tax deferred basis. These funds may be borrowed or withdrawn by the policy holder.

While the premium for permanent life insurance may initially be higher than that of term life coverage, in most cases, the amount due will not increase over time – regardless of how long the insured keeps the policy. This can provide an advantage to seniors who want to keep their coverage for many years or an indefinite length of time.

Which Type of Life Insurance is Right for Seniors?

One of the biggest questions a senior may have when shopping for life insurance is what type of policy is best for them. Therefore, it is important to assess the length and the amount of the coverage need before deciding upon a particular plan.

Regardless of whether term or permanent coverage is selected, it is likely that a senior will be required to answer a number of health related questions on the application – and in many instances, a senior may also need to have a medical exam in order to determine whether there are any adverse health issues that may deem the applicant as uninsurable.

In addition to more traditional coverage, many seniors may also opt to purchase final expense life insurance. This type of coverage is geared to providing quick benefit payments so that beneficiaries can pay an insured’s final expenses such as funeral services, burial costs, and other related debt obligations.

Final expense policies typically provide face amounts of between $1,000 and $50,000. Applying for such coverage usually does not require taking a medical exam – and in many instances an applicant may qualify for coverage by answering just a few simple questions.

There are several advantages and disadvantages to these plans that you should be aware of before you purchase a final expense insurance policy. It’s vital that you get the insurance protection that your family deserves.

One of those advantages is that anyone can purchase one of these plans, regardless of your health or any pre-existing conditions that you have. Because there is no medical exam or health questions, they insurance company isn’t going to decline your application.

Another significant advantage is that you can get insurance coverage much quicker with one of these plans than you would be able to get with a traditional life insurance policy. Since there is no medical exam, you won’t have to wait for the exam appointment or for the company to review the results. With some insurance companies, you can purchase a final expense plan and have coverage in a matter of hours.

When you’re looking to decide if you should purchase a final expense insurance policy or a traditional life insurance policy, there are several different factors that you should consider.

The first is, how much debt and final expenses that you’re going to leave behind to your loved ones. At this point of your life, you probably don’t have as many debts or unpaid expenses as you did before, but that doesn’t mean that you should forego a life insurance policy.

One reason that many seniors purchase a life insurance plan is because they want to leave their family with a sizable inheritance. Getting a quality and affordable life insurance policy is a great way to leave your family with a gift that can help them in countless ways. If you didn’t have a life insurance policy, Uncle Sam is going to take a large portion of the money that you would want to leave behind. Taxes can eat up an inheritance and leave your family with nothing left behind.

Where to Buy Life Insurance for Seniors?

Seniors are the fastest growing demographic of the United States population today. Within the 78 million baby boomer segment, it is estimated that an individual turns age 65 every 10 seconds – and this trend is anticipated to continue throughout the next decade.

Life insurance for seniors can be applied for in a variety of different ways, including through an agent in person and online. Prior to purchasing a policy, it is a good idea to compare several different options and insurance rates in order to determine which will provide the best benefit for an insured’s unique needs.

Each insurance is different, and all of them are going to look at seniors different when they are applying for life insurance. All of them have different medical underwriting techniques and are going to give seniors drastically different rates. It’s vital that you get dozens of quotes of insurance companies before you choose the one that’s going to work best for you and your loved ones.

Our independent agents can bring all of the lowest insurance rates directly to you. Unlike a traditional insurance agent, our independent agents represent dozens of companies across the nation. Our agents can bring insurance rates from several highly-rated companies all at once. Otherwise, you would spend weeks calling companies and answer the same questions over and over again. We know that your time is valuable, don’t waste it calling all of those companies yourself.

Comparing quotes from all of the companies is the best way to ensure that you’re getting the lowest insurance rates available to you. Your age is one of the biggest factors that the insurance company is going to consider when they are calculating your premiums, but that doesn’t mean that your insurance premiums have to break your bank every month. We can find you the perfect plan at an affordable rate that will fit in your budget

If you have any questions about getting life insurance for seniors or about the different options available to you, please contact one of our agents today. We would be happy to answer those questions and ensure that you’re getting the best policy to fit your needs.

You never know what’s going to happen tomorrow, which means that you shouldn’t wait any longer to get the life insurance protection that your family deserves. Not having life insurance, regardless of your age, is one of the worst mistakes that you can make for your loved ones.


Susan Wright holds a BA from Michigan State University and an MBA from St. Louis University. Having over 20 years of working experience in the insurance and financial services industry, she has trained more than 10,000 financial services representatives. Susan has had licenses in real estate, insurance, and NASD Securities, and she has earned nine industry professional designations, including CLU, ChFC, RHU, REBC, CSA, CLTC, CCFC, CSS, and ADPA. Read more about her on Google+