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Life insurance for people over 50

Fact-checked with HomeInsurance.com

Since life insurance is often marketed to younger working individuals with families to protect, you may not think it’s a good financial option if you are over 50. But there may be cases where a life insurance policy could strengthen your financial portfolio and provide value to your life.

More and more insurers are willing to work with older adults to write policies that benefit them and in some cases, are meant specifically for older clients. We’ll take a look at some of them below, and consider the factors involved in life insurance over 50.

Best life insurance for people over 50

The best life insurance quotes over 50 will come from financially stable companies with years of experience and a reputation for good customer service. Here are a few of the best:

Fidelity Life

Fidelity Life offers a range of term, whole life, accidental death and final expense insurance for older adults. The company’s RapidDecision Senior Life Term and Senior Whole Life policies are designed for those between the ages of 50 and 85 (or 50 and 70 for the term coverage) and provide coverage up to $150,000. Neither policy requires a medical exam, although the company says that these policies are not intended for those with life-threatening illnesses. Best of all, your premium rate is locked in and won’t change as you age.

Mutual of Omaha

Mutual of Omaha offers term, whole life, universal life and accidental death insurance to seniors, as well as more specific coverages of interest to older clients such as cancer, heart attack and stroke insurance. Some policies are available for those up to 85 years old, and the company’s term life insurance may be renewed until age 95. There is, however, a two-year graded death benefit for whole life policies, which means your beneficiaries will not receive a full payout if you die within two years of purchasing the policy. Mutual of Omaha also has final expenses insurance with a maximum coverage of $25,000.

Haven Life

Haven Life isn’t as well known as some of the other cheapest life insurance for over 50 companies, but it has a stellar pedigree: its policies are issued through MassMutual, which has an A.M.Best financial strength rating of A++. Some of its term policies are eligible for the InstantTerm process, which doesn’t require a medical exam and allows for a quick turnaround time after you submit your application. Policies are available for amounts ranging from $100,000 to $3 million, and terms up to 30 years for those up to age 64, allowing you to shape your financial strategy around a significant life insurance investment.

AIG

AIG offers guaranteed life insurance policies, which are available up to age 80. As the name suggests, coverage is guaranteed, even if you have existing health conditions, and the company says you will get an approval within 48 hours for up to $25,000. This policy also features a living payout for chronic illness and a 50% payment of death benefit if you are diagnosed with a terminal illness. As with other companies, however, there is a two-year graded benefit when you first purchase your policy — if you pass away during that time period, your beneficiary will receive 110% of the premiums paid, rather than the death benefit.

How to choose the best life insurance for people over 50

Choosing the best cheap life insurance if you’re over 50 isn’t difficult, but there are several factors to consider when you’re searching for the best rates and most appropriate coverage:

  • Type of policy
  • Amount of death benefit and/or cash value
  • Financial stability
  • Customer service

Type of policy

This is your first, and most important, decision. Do you want a term policy, which gives you simple coverage with a defined payout for a certain number of years — usually, 10, 20 or 30? Or would you prefer the more comprehensive coverage of a permanent life insurance policy, which lasts as long as you live and may have a cash value that you can tap into if needed? 

Term insurance is cheaper than permanent, of which the most common subtype is whole life insurance. If you simply want to protect your family in the event of your death, term is probably your better choice. If you want your life insurance policy to be part of a strategic financial plan, however, with a savings component embedded within it, consider permanent life insurance.

Amount of death benefit and/or cash value

Of course, the financial benefit is a primary concern when you’re looking for life insurance quotes over 50. For term insurance, that benefit is in the form of a payout to your beneficiary after your death, which can range from $25,000 up to several million dollars. Consider the needs of your family in determining what’s best: do you want to leave a legacy for your grandchildren? Are you concerned about the quality of life for your partner after you die? Would you like to make a significant gift to a favored charity? 

For permanent insurance, you’ll need to think about the same things, but you’ll also want to take into consideration the fact that the policy can give back to you well before your death. Cash value will start to accumulate after roughly the first decade of ownership, and may be useful if unexpected health concerns or other financial needs arise down the road.

Financial stability

You want to be sure the company that you choose is financially well-managed and able to pay out when the time comes. Most insurers are rated by organizations such as AM Best and Standard and Poors on their financial strength, and you can usually find those ratings on the insurer’s website. Generally, anything in an “A” range is considered excellent. 

Customer service

You want a company that is there when you have questions and can handle your insurance matters quickly and professionally. One way to get a sense of that is to check out J.D. Power’s U.S. Life Insurance Study, which is produced annually. Insurers are ranked based on overall customer satisfaction with their companies. 

Other organizations to check include Consumer Reports and the Better Business Bureau, which look at customer complaints, and other issues related to customer service.  

Do people over 50 need life insurance?

The easy answer is: “it depends.” If you are caring for grandchildren or a child with disabilities, you may want coverage well into your senior years. Life insurance may also be useful in paying estate taxes after you die, so that your heirs won’t be saddled with high taxes on your estate.

Some older adults use a life insurance policy as a way to make a significant gift to a charity, school or other favorite organization. The ability to leave a lasting legacy can be very appealing to anyone who cares about a cause.

In short, if you have any reason why you would want your heirs to have a sum of money available to them when you pass — from funding an education to paying for your burial costs — a life insurance policy is a good option. 

Challenges for people over 50 when purchasing life insurance

Life insurance for seniors may be more complex than it is for those in their younger years, for several reasons.

  • Age: Insurers determine their premium rates based on risk — i.e., how likely you are to die while the policy is in force. For older people, that risk is higher, and thus your premiums will be more than they would be if you were, say, 30 years old.
  • Health concerns: Another factor that goes into higher premiums is your relative health. For most policies, except guaranteed issue, you’ll need to take a medical exam. Since older people are more likely to have chronic health issues, their premiums will reflect that.
  • Purpose: Younger adults purchase life insurance to care for their partner and small children — but once you hit 50, your children are probably out and on their own. Your reasons for buying life insurance may be complex and require careful thought, making it a challenging decision.

Which type of life insurance is best if you’re over the age of 50?

This depends on your financial strategy. It may be worth consulting with a financial advisor or knowledgeable insurance agent to discuss the best choice for your own situation. Here are the most common types of policies:

  • Term insurance: If all you want is an inexpensive policy that covers you for a set number of years and will pay out to your beneficiaries upon your death, term is the way to go. 
  • Whole life: A type of permanent insurance, this stays with you until you die, and includes a cash value, which allows you to borrow money from the policy while you’re still alive. 
  • Universal life: Another permanent insurance that features lower premiums, but the cash value doesn’t grow at a fixed rate, and premium rates aren’t guaranteed.
  • Variable life: A permanent insurance with cash value, this option is invested in vehicles that fluctuate with the market.
  • Variable universal life: Similar to universal, with elements of variable policies, this is a good choice for those who want to expand their investments and are not averse to market risk.
  • Guaranteed issue, or burial insurance: A type of whole life that doesn’t require a medical exam and has smaller death benefits, usually no more than $25,000.
TermWhole lifeUniversal lifeVariable lifeGuaranteed issue
PremiumsFixedFixedVaryFixedFixed
Cash valueNoYesYesYesNo
Covered for lifeNoYesYesYesYes
Investment riskNoNoYesYesNo

The takeaway

  • It is possible for people over 50 to get life insurance.
  • Your financial strategy should help them determine if term or permanent life insurance is a better choice.
  • Life insurance over 50 can pay for burial costs, support a child or grandchild or leave a legacy to a favored charity.
  • Your costs may be higher because you carry more risk due to age and health.

Although life insurance policies may be pricier for older adults than they are for those who are just starting their families, it’s possible to purchase a policy when you’re older — even into your 80s. Term policies make sense if you just want an inexpensive way to leave something behind to your heirs; permanent policies are a good choice if you want to be able to tap into the policy’s benefits later in life.

Mary Van Keuren

After 30 years as a writer and editor in academia, Mary now writes full-time for the insurance and finance industries. Her work has appeared on Reviews.com, TheSimpleDollar.com and Bankrate.com, as well as other consumer-focused websites.

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