Term Life Insurance for Seniors vs. Whole Life Insurance

There’s never a bad time to purchase life insurance. Seniors are likely contemplating buying some form of life insurance as part of handling the autumn of their lives.

But it can be hard to sort what’s a good idea and what may not be suited for you.

Here are the basics, and the upsides and downsides, to both kinds of policies.

Term Vs. Whole

Term life insurance is fairly straightforward: You buy a policy that will cover you for a set number of years, usually ten to thirty. If you pass away, the insurance company pays out the policy’s value. It really doesn’t get more complicated than that.

Whole life insurance is, as you may have guessed, a bit more comprehensive. The plans are designed to last the insured’s life time. Whole life policies come in several different forms: Burial Insurnace, Simple Whole Life, Universal Life , Permanent Insurance, etc.. At the end of the day just think of Whole life insurance as insurance that will last the insured’s lifetime.

Term Life Insurance For Seniors: Benefits and Drawbacks

Term life insurance can seem appealing to seniors at first, not least because it seems less complicated. But that lack of complication comes with quite a few drawbacks. Let’s start with the simplest: You may want term life insurance, but you may not be able to get it in the first place!

Essentially, term life insurance is a gamble; the insurance company is betting you won’t pass away before your term is up, and they’ll be able to walk away with the premiums you’ve paid without having to pay on the policy.

Obviously, seniors can be at more risk of various problems than other groups, and as a result, you may have to agree to a medical exam, and you’ll have to pay more for the term. In fact, it pays to be suspicious of an insurance agent who doesn’t raise these concerns.

Also, if you pass away once the term is up, they’re not under any obligation to pay out the policy. You might be completely uninsured, leaving your loved ones to handle any expenses involved with burial and your estate.

Fear of paperwork can put your family at real financial risk.

Whole Life Insurance For Seniors: Benefits And Drawbacks

Whole life insurance can be easier to get, and in the long run might be a better deal for seniors ,as it lasts a life time. Most applications are simple Yes and No answers. There are No Medical Exams and most carriers will accept many different High Risk health impairments.

It’s not uncommon for financial advisors to pooh-pooh whole life, but it’s worth noting that’s from an investment perspective. Whole life , specifically Burial Insurance Plans, are for easing your passage for those you leave behind, and needs to be viewed from that angle. They are not intended to be used as an investment.

Most importantly, the policy will be in place for your entire life. You won’t have to stay on top of when a policy expires, worry about extending a term, or submit paperwork. You’ll just keep paying your policy.

One of the drawbacks can be the price of the premiums. Age and current and past health will determine that type of life insurance plan you may qualify for. Older people with health impairments will pay more. However, most carriers offer lower face amounts , some as low as $5,000, so the face amount can be adjusted so the monthly premium is more affordable.

Summery

Life Insurance, primarily Burial insurance,  will allow you to plan ahead. No one enjoys planning for their passing, but with life insurance for Senior Citizens,  you’ll know that the funding is in place to allow your final wishes to be granted, and you can get on with living. That’s the most important benefit of all.

If you would like to get a no hassle , no pressure quote , please call me today. M2 Insurance is not a Call Center or a Lead Gathering company, I am an independent broker with over 20 carriers that specially handle Final Expense insurance plans.  My number is 512-963-5000.