What Over 50 Life Insurance Options Do You Have?

by News Guy on November 30, 2011

If you are in the over 50-age bracket, life insurance is an investment in the security of your family. Death can have catastrophic consequences for those who depend on you. This is especially true if you are self-employed and uninsured. The good news is that there are affordable options for you, regardless of your age.

Over 50s life insurance is a type of guaranteed acceptance policy. The requirements for qualifying are minimal, making it easier to obtain coverage. There are usually some restrictions, such remaining in the same geographical area and keeping the premiums paid up.

The amount of the premium will depend on the type of the policy that you choose and the risk category that you fall into. While each companies risk scale is unique, there are some common defining factors. Age, sex, general health, and smoking habits are used to determine how much over 50s life insurance will cost.

This type of insurance has a time limit that will expire. During the period it is in effect, the amount of the premium remains fixed. When it elapses, you must either renew at a higher rate or lose the coverage all together. Term policies have no cash value, other than the benefit the beneficiary will receive upon your death. The different types of term insurance are:

Level Term

Level term policies are probably one of the most common types of life insurance. The length of coverage can last between 10 and 30 years, depending on your exact age. In this situation, the premiums and conditions remain the same throughout the policy. The benefit amount is guaranteed at the start of coverage.

Decreasing Term

The benefit amount of the policy starts out at set amount, then decreases each year until it has no value. Decreasing term can be a good option if you have outstanding loans that would have to be repaid upon your death.

Increasing Term

This is very similar to decreasing term, except that the benefit amount will increase each year. If you anticipate continuing coverage over a long period, it may be right for you. The pay-out amount typically goes up five per cent annually, depending on the rate of inflation.

Convertible Term

Convertible term insurance allows the policy to be converted into a whole life plan upon expiration. Although a little more expensive, it offers many advantages. The primary gain is that it guarantees you a new policy, regardless of your health conditions. Expect to pay about 10 per cent extra on premiums.

In some cases, a standard plan may offer lower rates if you are able to meet the health requirements. To offset the cost, policies and insurers will sometimes offer a premium cap option. This is beneficial if you plan to keep the policy over a long period. It guarantees the monthly premiums will never exceed the value upon death. Keep in mind that if the over 50s life insurance policy expires, it won’t pay any benefits.

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(Guest Post)

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