Term life insurance allows seniors to pass on a meaningful, tax-free death benefit to beneficiaries. This makes it a great potential tool for financial planning purposes, as it helps beneficiaries receive more of the senior's assets.
Some seniors over 65 worry that they may not qualify for term life insurance. The truth is seniors over 65 can still get term life policies, even if the premiums are slightly higher than for younger policyholders. This article will explain the typical age limit for buying term life insurance, then dive into several benefits of term life insurance for seniors that justify the slightly higher premiums.
What is the typical age limit for buying term life insurance?
The exact age limit for buying term life insurance can vary between insurers. However, many consider 80 the upper limit, and some companies may increase that to 90. Term length can affect the age limit as well. For instance, an insurer may have a lower maximum age limit for a 30-year policy than a 10-year policy.
Benefits of term life insurance for seniors
Seniors may have to pay more for term life insurance than younger policyholders, but the benefits can be well worth it. Here are some advantages of term life insurance for seniors:
According to a recent LIMRA study, over 50% of people overestimate how much life insurance costs by three times or more. But life insurance can actually be more affordable than many may think.
Since term life insurance is a temporary policy, it offers less expensive premiums than permanent life policies and can help those who want to keep costs low during retirement. This means seniors can get the coverage they need to provide their loved ones with extra financial security at a price that works for their budget.
Some policies don't come with a medical exam
Some term life insurance policies don't include a medical exam and instead ask a few health-related questions. With these policies, the policyholder may be able to get the coverage they need as soon as the same day they apply. For example, Fidelity Life's RAPIDecision® Senior Life Term offers affordable term life coverage and typically does not require a medical exam. No-exam insurance can be a great tool for seniors because it can allow seniors to get the coverage they need more quickly.
It helps with financial planning
Life insurance can be a great part of a financial plan. Death benefits are tax-free to beneficiaries, allowing seniors to pass more of their wealth down to their loved ones. Term life insurance can help seniors do that at an affordable cost.
Term life insurance lets seniors choose their term length, usually between 10 and 30 years. This helps seniors customize the policy length based on their needs and preferences. Plus, seniors may be able to add riders to their policy to tailor their coverage further. For instance, in times of high inflation, a senior might add an inflation rider. This will help them increase their death benefit each year to keep up with inflation.
The bottom line
Seniors over 65 in good health can still qualify for term life insurance, although they may pay higher premiums than younger policyholders. Still, this can be an affordable option for those that want to ensure loved ones will receive the death benefit. Seniors may not need to take a medical exam and can get coverage very quickly if they qualify. Additionally, term life insurance can be an excellent financial planning tool. Seniors can minimize costs and maximize approval chances by shopping with multiple insurers, gathering quotes, then applying for the best offer
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