Do Retirees Need Life Insurance?

When planning for retirement, many people feel that those who are over age 50 no longer need life insurance coverage. But regardless of your age, however, it is still important to be prepared financially in case of an unexpected event.

In the past, most retirees were likely to have major expenses such as their mortgage paid off. Today, though, many people not only still have large, ongoing expenses every month, but they also still have others such as children – and grandchildren – depending on them.

In addition, due in large part to the recent market downturn of 2008 and 2009, there are numerous retirees who are still recovering from substantial losses in their retirement portfolios. This means that they are still trying to rebuild lost savings in the hopes of retiring on time – or even retiring at all.

retirement and life insuranceEvery person is different, which means that everyone is going to have different life insurance needs, especially as they get closer to retirement. Not having the proper life insurance coverage could be one of the worst mistakes that you could make for your loved ones. If something were to happen to you, and you didn’t have life insurance, your family might be left with some massive debts that are going to make the situation that much worse.

Let us help you find quotes from the best life insurance companies for seniors over 50.

Why Life Insurance Is Still Needed In Retirement

Even if you’re retired, there are still a number of reasons why it is important to purchase life insurance – or to keep the coverage that you already have, if you already have coverage we highly recommend keeping it. If you cancel and eventually want to get another policy, you will be older and risk that your health has gotten worse and you may not be able to qualify for the traditional medically underwritten policy. There are options such as a no medical exam life insurance policy if you absolutely need coverage, but those will come at a much higher premium rate than the policy you got when you were younger and healthier.

First, should the unexpected occur, it is likely that your loved ones would need to pay final expenses.

Today, the average cost of a funeral runs approximately $10,000. Rather than depleting the funds that they have in savings, or racking up large debts on their credit cards, wouldn’t it be easier to use life insurance proceeds to allow your heirs to quickly and easily pay these costs?

Proceeds from life insurance are also typically used for paying estate taxes. Depending on the size of your estate, as well as your marital situation, it may be possible that you will be hit with a large estate tax bill upon death. In some cases, your estate taxes could up in excess of 50% of your total net worth.

By structuring a life insurance policy – especially through an irrevocable life insurance trust – you will be able to effectively decrease your total taxable estate, and use policy proceeds for the payment of your estate taxes that are due. This, too, is much easier than burdening your heirs with what could essentially be a fairly hefty bill.

One of the biggest reasons to have life insurance in retirement, though, is for income replacement. If you are married or have a significant other, and your spouse or partner will lose a substantial portion of your pension or other income when you pass away, it is absolutely essential that you have life insurance in order to replace this lost income for him or her. Otherwise, their lifestyle will be drastically reduced at that time.

Retirement Savings Solutions

In addition to just the death benefit options, life insurance can also provide retirees with income solutions as well. For example, whole life insurance offers a great way to build up a nice amount of cash value over time on a tax deferred basis.

If you have owned a permanent life insurance policy for any number of years, you may be able to withdraw or borrow from these funds and use them as a retirement income supplement. This can be especially important, as many people may not be able to rely on pension, 401(k), and / or Social Security retirement income alone.

Solutions for Retiring Business Owners

If you’re a retiring business owner, life insurance can provide some ideal solutions for you as well. For example, this financial tool can be part of your business succession plan. For example, should you pass away suddenly, life insurance policy proceeds could be used to pay business expenses during the time that it takes to find a replacement – or to keep the business running while finding a buyer for the company.

Giving Solutions

Many retirees also opt to donate to a favorite charity as well – and life insurance can provide them with the ability to do that. By making a charity the named beneficiary of your life insurance policy, the organization will be able to receive the face amount of the policy proceeds tax free. Naming a charity as your beneficiary can allow you to donate an amount that is much larger than if you just donated cash directly.

No Exam Life Insurance for Retirees

One available option to anyone retiree is to buy a no medical exam life insurance plan. As you can guess from the title, these no exam life insurance will allow you to get insurance coverage without having to take the medical exam first. These plans have several advantages had disadvantages that you should be aware of when you’re shopping for insurance protection.

As we mentioned earlier, no exam plans are going to be more expensive than a traditional policy. The purpose of the medical exam is to give the life insurance company idea of how much risk you are to insure with a life insurance plan. The insurance company is going to offset that risk by charging you higher premiums. If you want to get lower premiums, you’ll need to apply for a plan that requires a medical exam.

Another pitfall of these policies is that you’re going to be limited on how much insurance you can buy. Most companies are only going to allow you to buy $250,000 worth of protection. For most families, this may not be enough life insurance. Not having enough coverage can be just as bad as not having life insurance at all. Before you apply for life insurance, it’s important that you decide how much coverage your family will need. We can put you in touch with cheap term life insurance companies so you can get the best rates available.

One of the best advantages to no exam policies is that you can be approved for insurance coverage much faster than you can with a traditional insurance plan. With a normal life insurance policy, it could take several weeks or even a month to get life insurance. With a no exam policy, you can be approved in a matter of days. If you want to get life insurance as quickly as possible, then a no exam plan is going to be the best option for you.

The Bottom Line

While many people feel that they should only carry life insurance if someone is counting on them for income, this is actually not the case. There are countless other reasons for obtaining – and keeping – life insurance coverage. This financial vehicle can be structured in numerous ways, and it can literally be customized to fit with your specific planning needs and goals – regardless of your age or your stage in life.

Instead of wasting time calling dozens of insurance companies yourself, let one of our independent agents do all of the work for you. We work with some of the best rated insurance companies across the nation, and we can bring all of the best insurance premiums directly to you.

We know that shopping for life insurance is not a fun experience, but that’s why we are here to help. It’s our mission to ensure that you’re getting the best life insurance coverage for you and your family. If you have any questions about life insurance for retirees, please contact one of our agents today. We would be happy to answer those questions today and ensure that you’re getting the best life insurance coverage.

You never know what’s going to happen tomorrow, which means that you shouldn’t wait any longer to get the insurance protection that your family needs. If something were to happen to you, and you still have massive debts, your family would have financial struggles as well as emotional ones. Just because you’ve retired, or you’re getting close to retirement, doesn’t mean that you don’t need life insurance. Contact our life insurance agents today and we would be happy to answer any questions that you have and get the process started.

About Jack D. Davis at
About Jack D. Davis at

Jack D DavisBorn and raised in a quiet suburb of Philadelphia, PA, the youngest of nine children, son of two wonderful parents, Jack developed his work ethic early on. While attending West Chester University, he volunteered to join the US Army Reserves for a six-year enlistment. Attending college during the day, working evenings, and fulfilling his military obligation on various weekends, Jack learned the value of hard work and time management. After graduating from college (BS in Business Management), he began working as a sales representative for a Fortune 100 company and honed his marketing skills. In 1985 Jack started his financial planning career as an agent with Mutual Benefit Life.  After Mutual Benefit Life ran into financial difficulties, Jack decided to “go it alone”. His company, “Eagles Soar Enterprises, LLC.” successfully grew for almost 30 years. Jack’s skill-set is understanding and recognizing the personal needs of families and business owners. His patience in explaining the numerous options available is greatly appreciated by his clients. Jack agrees that life insurance is a difficult topic and people are rarely “excited” about discussing the subject. When Jack was 23 he witnessed firsthand how important life insurance is when he lost his Dad to cancer. Jack’s Mom used the life insurance proceeds to help minimize the financial loss.  Jack recognizes how critically important proper insurance planning is to the surviving spouse, business partner and, most importantly, the children of his clients. In his free time Jack enjoys playing tennis, horseshoes, ping pong, exercising, reading and attending Philadelphia Eagles football games. Jack has two wonderful children and currently resides in beautiful St. Petersburg, FL. Questions? Call Jack at 1.800.277.3098 or email:

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