If you’re over 50 and looking into insurance there are plenty of places to find affordable life insurance. Literally dozens of different websites across the Internet offer cheap insurance for seniors and just as many if not more sites are promoting these offers for a chunk of the commission being offered.
Life insurance is a multi billion dollar industry that uses the odds and mortality rates to make sure that the insurance companies are the ones that end up winning in the end. If you’re looking for affordable life insurance for seniors, they are definitely out there, here’s where to look.
Senior Life Insurance Companies
You can buy burial protection from any of the top rated life insurance companies. There is more than one company that specializes in policies for those of us over 50.
The two most popular are Colonial Penn and AARP. It’s always a good idea to get quotes from these companies first, but don’t stop there. Make sure to get a few more quotes from highly rated companies. You’ll be surprised by just how much the quotes can vary.
You Might Want To Avoid Guaranteed Burial Insurance
This is the type of insurance you see advertised on the late-night commercials and between your favorite shows in the evening. A celebrity comes on and tells you that you can get cheap life insurance even if you’re over the age of 50, and best of all you won’t have to take a medical exam.
Even though this sounds too good to be true, and often it is, a lot of seniors fall into the trap and apply for the insurance anyway. The insurance is definitely affordable, but there are gotchas in the terms and conditions attached to the policy that you won’t know about unless you read the fine print carefully.
How Guaranteed Policies Work
With a guaranteed policy, you usually cannot collect on any claim for the first two to three years that it is in effect. The policy is structured this way since there are no medical examinations required. This means that a person that is dying can’t take out the policy and then have it cashed out for thousands of dollars by the beneficiaries within this certain time span. Many policies will also ask if you have a life-threatening condition and if you don’t answer truthfully the claim cannot be processed.
Some insurance companies will pay out during the first couple of years but only the amount that you have already paid into the policy. When you calculate how much that amount would be, it seldom even comes close to covering the basic costs of funeral arrangements.
Do You Really Need Coverage?
Most people invest in burial insurance when they are young and want to protect other family members should anything unfortunate occur. A man that is the main breadwinner in the family wants to make sure that his young wife and three children would be taken care of should anything happen to him. This is the type of peace of mind that any young family should be investing in and it makes a lot of sense.
What doesn’t make sense, however, is charging an older person an insurance premium that may or may not even end up covering his basic funeral expenses. These are the low coverages that you can expect without paying higher fees.
What To Expect From Affordable Senior Plans
If you’re not willing to pay an arm and a leg every month, the most that you can usually expect is $10,000 up to $25,000 in coverage. Your beneficiaries will end up seeing this amount only if you should pass on after the first couple of years after you’ve taken out the policy and before the term is over.
If this should occur, then you’ll probably end up breaking even in the long run. Sometimes your beneficiaries will even end up getting more than what you have put into the policy but now always.
Odds Are Your Premiums Will Rise
If you are being quoted a low amount for senior life insurance the first question you’ll need to ask is whether these payments will go up as you continue to age. While it may seem like the monthly payment is low right now, the premiums can rise pretty quickly once you pass the age of 50.
Exercise A Little Common Sense
Life insurance companies are in the business of making money by playing the odds. If they were to provide cheap insurance to people over the age of 50 without any type of conditions and terms attached, they would end up losing in the end. In order to see any large benefits in this age range, you’ll have to look at other life insurance options that will cost more than these guaranteed plans with lower payouts.
Life insurance is structured so that the company comes out on the winning end the majority of time. A life insurance company isn’t going to get too far by offering inexpensive insurance to seniors and allowing beneficiaries to claim large amounts without going bankrupt. If things seem too good to be true, they usually are.
Is There A Better Option
Before taking out any type of life insurance policy after the age of 50 you’ll want to really question what you are going to be paying into the program and what you can realistically expect to see out of it. You’ll also want to crunch the numbers and see whether you’d be further ahead by just taking the money that you would put into an insurance policy and put it into a guaranteed investment program instead.
Most people end up buying a policy like this because they are advertised as being affordable but there isn’t a lot of discussion about the small amount of coverage being offered. Your calculator can be your best friend when it comes to making a decision about your life insurance options as a senior and whether it is really an investment in your future or a complete and utter waste of money.