It’s interesting that many seniors assume life insurance will no longer be available to them once they are over age 70. Most think that the cost will be prohibitive or that medical issues will disqualify them from being approved for coverage.
In this article, we’ll debunk the myth that life insurance for seniors over 70 is out of reach and will even show you how affordable insurance for seniors can actually be.
Most seniors know that there are several types of insurance to consider, but are unsure of the type that will best meet their needs and budget. The type of life insurance you should purchase will always depend on your actual need for insurance. The price you pay for coverage is immaterial if the policy will not be the solution to your individual needs.
Why would a Senior over 70 Need Life Insurance?
Believe it or not, there are many people out there who believe that once you are a senior your need for life insurance is considerably reduced because of the size of your estate. They mistakenly believe the longer you’ve been alive, the bigger your estate becomes. Regretfully, that is not always the case.
Many seniors cashed in or sold their life insurance policies in order to survive the market crash in 2007 and then found that it was difficult or expensive to replace it after the market returned to normal.
Other seniors worked most of their adult lives and had group term insurance coverage that they assumed would be enough coverage for a lifetime but only to find when they retired, their group term insurance coverage wasn’t portable.
In many cases, uninsured seniors didn’t realize that their surviving loved ones would have to bear the burden of funeral costs and other final expenses when they passed away and only began to consider how this could affect their loved ones after seeing final expense insurance commercials on TV.
Which type of Life Insurance Makes Sense for Seniors over 70?
The life insurance industry is always innovating and bringing new products to the marketplace. They do this to respond to the needs of consumers and compete with companies who are slow to develop new products. Here are the most popular types of life insurance for seniors to choose from:
Term Life Insurance
Term life insurance is the least expensive type of life insurance but is typically not the best solution for seniors since it is not permanent and builds no cash value. Although most companies will offer renewals of a term policy, the renewal term is typically for a year only. This means that each year you renew your term insurance the rates will go up according to your age and can easily become unaffordable when you are over 70.
Universal Life Insurance
Although universal life is considered permanent insurance life insurance, the required premiums are not guaranteed since the policy uses a portion of the cash value in the later years to pay the increasing cost of the life insurance.
You can select a Guaranteed Universal Life insurance policy which is similar to whole life but the policy does not build cash value over time since all the cash is used to cover the increasing cost of your life insurance.
Final Expense Whole Life Insurance
If your goal is to provide the funds needed for your surviving loved ones to pay for your funeral costs and other final expenses like unpaid medical bills or unpaid nursing home costs, final expense life insurance (whole life insurance) is the better solution for seniors over 70. Companies that offer final expense insurance have liberal underwriting guidelines, do not require a medical exam or blood/urine tests, and will approve seniors who have typical health issues like diabetes and high blood pressure without requiring a waiting period.
What if I have Health Issues?
Although there are many seniors who are blessed to have great health in their seventies, most seniors have to deal with health issues as they age. Some of the more common health issues that seniors deal with are:
- Arthritis
- Heart disease
- Cancer
- Alzheimer’s disease
- COPD and other respiratory diseases
- Diabetes
- Hepatitis C
Even though most of these diseases can become chronic, they may not necessarily prevent seniors from buying life insurance when they are over 70. Knowing that seniors frequently must deal with these diseases, many life insurance companies are offering graded benefit or guaranteed issue policies which allows the company to accept seniors with high-risk medical conditions.
How much Life Insurance do Seniors over 70 Need?
If you are considering a final expense life insurance policy, the death benefit should be at least sufficient to cover funeral and burial expenses that would be passed on to surviving loved ones. If your budget will support additional death benefit, then, by all means, consider additional benefit for taking care of unpaid medical expenses or nursing home costs that weren’t covered by Medicare.
Funeral and burial expenses are based various things like where you live, the type of funeral you want, the memorial service, and other bells and whistles that funeral directors use to fatten the funeral and burial invoice. According to national funeral services like Parting.com, Funeralwise.com, and the NFDA (National Funeral Directors Association) you can expect an average funeral to cost between $9,000 and $12,000 per year. It’s also important to note that the longer you live, the more it will cost to bury you when your time comes.
How much does Final Expense Life Insurance for Seniors over 70 Cost?
Just like traditional life insurance, final expense insurance rates are based on three primary things; your age at the time of application, your current health and health history, and the amount of coverage you want to purchase. Although most final expense insurance companies offer death benefits of $5,000 to $30,000, the most popular policy amounts are $10,000, $15,000, and $20,000.
Here are actual rates for a $10,000 policy for a male and female non-smoker:| Age of Applicant | Male Non-Smoker | Female Non-Smoker |
| 70 | $69.93 | $53.12 |
| 75 | $97.43 | $72.41 |
| 80 | $132.65 | $98.43 |
| 85 | $183.15 | $135.90 |
| Age of Applicant | Male Non-Smoker | Female Non-Smoker |
| 70 | $103.38 | $78.18 |
| 75 | $144.64 | $107.01 |
| 80 | $197.38 | $146.05 |
| 85 | $273.13 | $202.25 |
| Age of Applicant | Male Non-Smoker | Female Non-Smoker |
| 70 | $136.84 | $103.23 |
| 75 | $191.85 | $141.62 |
| 80 | $262.11 | $193.66 |
| 85 | $363.10 | $268.60 |
Please click here for accurate rates for your actual age.
What if I don’t Qualify because of Health Issues?
Seniors who have severe or multiple health issues can still purchase life insurance even if you don’t medically qualify for a standard final expense insurance plan. As we mentioned earlier, there are companies that offer guaranteed issue (guaranteed acceptance) life insurance for anyone who is alive and under age 86. This means that you can get the final expense insurance coverage you need and not have to worry about serious or multiple medical conditions.
Companies that offer guaranteed issue life insurance do charge more and typically have a two or three-year waiting period before they will pay the full death benefit if your death is the result of natural causes. Typically, if the insured dies from natural causes during the waiting period, the insurance company will pay the sum of all premiums paid in plus an additional 5 or 10 percent.
If, however, your death is the result an accident, the company will pay the full death benefit from the first day of coverage. This means virtually any person under the age of 86-years old can buy final expense life insurance.
Conclusion
Now that you understand that Life Insurance for Seniors over 70 is not out of reach, don’t delay in getting covered because your life insurance rates will never be less than they are today.
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Being independent, I represent many highly-rated insurance companies and, because I am not beholden to any one insurance company, my focus is to find the right company and policy for each individual client.
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