Life Insurance for Seniors in their 80s | Is it too Late?

Is there a point in a senior’s life when they’re too old to buy life insurance? In our experience, we have found that 90 is the typical limit for purchasing life insurance, but it is possible to buy life insurance after 90. However, the cost of coverage is simply ridiculous.

But, for seniors who are between 80 and 85, getting affordable life insurance is still very possible; in fact, it may be quite simple depending on how much life insurance you want to buy. Some may be wondering why someone would wait until they’re over 80. Actually, there are several reasons that might be in play.

Why Seniors buy Life Insurance in their 80s?

Over the years, we have found that there are several typical reasons that a senior in their 80s may be looking to purchase life insurance.

• An emotional decision – Lately, several insurance companies have been heavily advertising final expense life insurance using emotional ads to get seniors to consider buying.
• Encouraged by Family Members – When children or grandchildren discover elderly family members are uninsured or underinsured, often they will encourage the parent or grandparent to consider buying life insurance, or they may buy coverage for them.
• Procrastination – Many times, I’ve found where a client who worked into their late sixties discovered when they finally retired, their employer-sponsored life insurance wasn’t portable. When they tried to purchase an individual policy, they found that the rates were unaffordable, or they didn’t qualify for traditional insurance, or both. They put it off and eventually forgot about it.
• The passing of someone close – Most life insurance purchases are event-driven. When someone close to you passes away without life insurance, you and other family members are usually left holding the bill for a funeral. When this happens, the first thing you might do is check on your own life insurance and find that you are uninsured or underinsured.

What choices would I Have in My 80s?

Believe it or not, you will have choices of which type of life insurance you can buy in your 80s. Term life insurance will be difficult to find, but there are a few companies out there that will offer a policy if you qualify medically.

Term Insurance

For example, most healthy seniors who are 80 years old can buy a $50,000 10-year term policy for about $330 per month. However, you must purchase at least $50,000 in coverage, and it’s unlikely that the insurance company will offer a renewal when the 10-year term expires. Knowing this, you may want to use a different insurance product because it’s very possible to outlive your coverage. We have not found any companies that are willing to offer a 10-year term policy to anyone 81 years old or over.

Guaranteed Universal Life

Another life insurance product that can be obtained by seniors in their eighties is Guaranteed Universal Life. This product is similar to traditional universal life, but the focus is on the death benefit and length of coverage rather than cash accumulation. Most insurance companies that offer guaranteed universal life require a minimum death benefit of $50,000, but there are a few that will go as low as $25,000.

Here’s an example of the rates for life insurance for seniors in their 80s. These rates are based on a $50,000 death benefit for a healthy male and female non-smoker. Coverage is guaranteed to age 105.

 

Age of Applicant	Male Non-Smoker	Female Non-Smoker
80	$392.50	$342.00
81	$424.00	$369.50
82	$459.50	$399.00
83	$500.00	$430.50
84	$545.50	$465.00
85	$597.00	$499.82

Applicants will typically have to go through medical underwriting, but it’s worth it to know that your life insurance coverage will be in force until age 105. Policies that cover up to age 121 are available for an additional premium. Contact LifeInsure.com to see if Guaranteed Universal Life would be the right product for you.

Final Expense Whole Life Insurance

Typically the most popular insurance product for seniors in their 80s, Final Expense Whole Life Insurance policies are available to seniors up to age 85 with face amounts of $3,000 to $30,000, depending on your age when you apply for coverage.

Final Expense Whole Life Insurance is very popular with seniors because policies are easy to purchase and no medical exam is required. Because it’s whole life insurance, final expense policies come with the guarantees and benefits found in traditional whole life insurance.

Your insurer cannot cancel your policy for any reason other than non-payment of premium.

Once your final expense policy is issued, the insurance company cannot increase your monthly premium for any reason.

Over time, your final expense policy will build cash value on a tax-deferred basis. You can easily access this cash for any reason using policy loans, cash withdrawals, or surrender your policy for its full cash value.

Here are actual rates from Mutual of Omaha for a $20,000 Final Expense Policy (most popular) for a healthy male and female non-smoker:

Final expense whole life insurance is typically purchased to cover final expenses like funeral and burial costs and unpaid medical and nursing home expenses. Most insurance companies have liberal underwriting standards that allow applicants with typical senior health issues to qualify for coverage.

For applicants who cannot qualify for this level benefit, first-day coverage, most companies offer a guaranteed issue final expense policy that does not take the applicant’s health condition into consideration. A guaranteed issue policy will normally have a two or three-year waiting period before the full death benefit will be paid for death due to natural causes. The premiums for guaranteed issue final expense insurance are considerably higher than the “level benefit” policy because of the unknown health risk.