If you’re a senior then you should certainly consider taking out a senior life insurance policy. Reaching an older age means that there are greater risks at stake, and especially in terms of health issues. This highlights the need to be aware of various factors about life insurance for seniors. Here are some of the most important issues:
What Areas are Covered?
Senior life insurance can actually have various names, including guaranteed life/funeral insurance/burial policies. These all basically have the same meaning, so it’s important not to get mixed up when you hear the different terms.
Each type of insurance is a whole life insurance covers various end-of-life expenses. It’s important to keep in mind that senior life insurance is different from investing in standard whole life insurance. Senior life insurance includes guaranteed premiums that cause it to be a low investment risk. It also has a cash value that increases over time, but value is quite low.
There is another popular type of life coverage available – term life insurance. You can purchase such coverage for a pre-specified period such as 5, 10, 20 or 30 years long. This type of policy is valid up to that period and once expired, you can apply to renew. Note that, longer term policy costs higher because you have a higher rate to die within that period.
Funeral costs in particular have increased greatly in recent years. A traditional funeral costs about $9,000 today on average in the USA. This is one of the most significant end-of-life costs for seniors. However, other ones include hospital bills, and various other end-of-life expenses.
Choose Whole Life Insurance if you want your beneficiaries to get a lump sum benefits after your death as it generates cash value which adds up with the death benefits eventually.
Choose Funeral/Burial Insurance if you just want to cover your funeral costs making sure every other financial matters such as mortgage loan or personal debt is already paid.
Choose Term Life Insurance if you want a coverage that is simple, affordable and available from your local providers. Although you will need to renew this policy once the term is expired, but it is an inexpensive means of covering your life.