Purchasing a life insurance policy becomes trickier as a senior citizen, as your age and health have a major role in receiving the life insurance coverage that you seek. Pairing with an insurance broker will assist you in finding an affordable plan that works for you.
Finding affordable life insurance as a senior is much different than finding the same insurance as a young or middle-aged adult. As a senior, you likely have at least one pre-existing condition, and many seniors need life insurance coverage, despite many health issues. It is still entirely possible to find a life insurance plan that works for you as a senior citizen, it just might take a bit of extra work! There are four major types of life insurance available to seniors, which are all outlined below.
Traditional Life Insurance for Seniors
Traditional (or standard) life insurance coverage for seniors typically covers up to a maximum of $3,000,000 to $5,000,000. In order to qualify for most traditional life insurance policies, you will need to complete a medical test and a long questionnaire. When it comes to pre-existing conditions, only some non-serious ones are allowed. If money happens to be an issue, this is the cheapest life insurance option available to seniors.
Rated Life Insurance for Seniors
Next is rated life insurance for seniors, which typically covers up to a maximum of $3,000,000 to $5,000,000, just like traditional life insurance. The difference between these first two options is the cost, and the pre-existing conditions that are allowed. You will need to complete a medical test and a long questionnaire, just as you would for standard life insurance. However, some average pre-existing conditions are admissible, such as certain types of diabetes, or non-serious heart disease. Due to this plan’s acceptance of a wider range of pre-existing conditions, it is more expensive than standard life insurance. These types of plans are often very reasonable, considering what kind of coverage you get for the price, despite your pre-existing conditions.
Simplified Issue Life Insurance for Seniors
If you are over 80 years of age, you may also qualify for a simplified issue life insurance policy for seniors. This type of insurance typically covers up to a maximum of $50,000 to $300,000. To be eligible, you must complete a short questionnaire. There are numerous pre-existing conditions that are allowed under these plans, even including some advanced pre-conditions. As a result of this inclusion, simplified issue life insurance for seniors is more costly than traditional life insurance for seniors.
Guaranteed Issue Life Insurance Plan for Seniors
If all else fails, there is still a senior’s life insurance plan that is out there for you, even if you have medical issues. If you are over 50 years old, you are eligible to participate in a guaranteed issue life insurance plan. These plans typically cover up to a maximum of $25,000, and there is absolutely nothing that you have to do in order to get it. Any and all pre-conditions are allowed, no matter how serious. As a result of the freedom from pre-existing conditions holding you back, this is the most expensive option out of all the senior’s life insurance policies listed.
Factors that Contribute to High Insurance Rates
Your current health has a big impact on the type of senior’s life insurance that you can choose when shopping around for insurance quotes. The coverage that you are eligible to receive is heavily dependent on your age. The older you are, the higher your insurance costs will be. This is why you should try to purchase life insurance as soon as possible. The earlier you purchase a policy, the lower your rate will be.
Also keep in mind, your life insurance provider will raise your premiums if you smoke, although the older you are, the less of a difference there is between the premiums for smokers and non-smokers. If you have little to no pre-existing conditions, take advantage of that while you still have time! Traditional, rated life, or simplified issue life insurance are the cheapest options, so if you are able to go with one of these three options, definitely do so. Unfortunately, if you are plagued by medical issues, you might have no other option than to go with guaranteed issue life insurance.
Various insurers treat these topics differently, and some companies may be able to offer you better policies than others. For this reason, it is important to contact an insurance broker who is experienced in dealing with the purchase of life insurance with pre-existing conditions. If another insurer has previously denied to issue you a life insurance policy for any of these reasons, you may have difficulties in getting a simplified issue life insurance policy. However, in this case, keep in mind the guaranteed issue life insurance plan that is available to everyone.
How to Lower Senior’s Life Insurance Rates
There are ways to help lower your insurance costs, so do not be discouraged by the risk factors outlined. If you do not smoke and have no previous record of some serious illnesses, you are more likely to receive a cheaper insurance quote. In these cases, you may save approximately 35 per cent on premiums.
There is also something called last-to-die coverage, which suggests a lower premium rate due to the benefit only having to be paid to the beneficiary once, after the death of the second spouse. For example, a policy for two spouses who are 65 years old will be priced similar to a single policy for a male who is 58 years old.
When it comes to shopping for life insurance, especially as a senior, it is important to shop around and assess all of your options. Especially if you’re older, your insurance premiums might become very high, unlike car insurance. Comparing rates among several insurers may save you thousands of dollars every year. Work with an insurance broker who can compare the market for you and see what kind of insurance policy for seniors you can find!
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