Seniors over age 70 and life insurance

As long as someone is in good health, age really should not be an issue. Yet, when an individual over age 70 looks for a life insurance plan, many insurance companies seem uninterested or they want to charge ultra-high premiums.

The reasons!

Actually, the reasons are simple. Many insurers feel that after age 70, the risk of paying a claim has greatly increased. The fact is, as we get older, the likeliness of developing a terminal illness has become much greater (although accidental death has decreased). Also, need for larger amounts of insurance seems to diminish greatly. Many insurance companies are not willing to issue policies below $50,000 and even less do below $25,000. There many other reasons for the cost and reduced availability but these mentioned above are the main ones.

What can an individual over the age of 70 expect?

Well depending on your health and your needs, you will either have several options (from term to whole life to universal life) or very few (mainly whole life).

If your health is very good

If your health is very good and your life insurance needs are $100,000 and above, you should be able to get almost any kind of plan. As a matter fact, you may even find that $100,000 polices are cheaper than some $25,000 policies. The reason for that is that at $100,000 and above more insurance companies will be competing for your business and thus cost per $1,000 of insurance will be lower. Also, at $100,000 and above, more insurance companies offer super preferred ratings. A word of advice for anyone at any age, volume discounts have existed for a long time so if your need is for $50,000, request a quote for $100,000. You may be surprised by the better rates you get at $100,000.

If your health is bad

If your health is not the best, you may still have many options but that will depend on your health issues. You may be able to secure a good $100,000+ policy at standard rates or slightly higher or your policy may be highly rated (you are charged higher than standard premiums). If your policy is highly rated, consider no exam whole life plans. Because these plans have minimal underwriting, they, at times, come out cheaper than even some term life insurance plans.

If you have bad health and your need is under $100,000, you may find that your choices are simply limited to whole life or universal life. If you want a simple process, then a good no exam simplified whole life should do the job. If you feel you may be able to qualify for better rates, there are many good short and long term universal life plans that may come out well for you (offer lower rates and flexibility).

If you need a small amount of life insurance (under $25,000)

If you only need a final expense or burial policy for $10,000 to $20,000, then I highly recommend a simplified underwriting whole life. Rates on these policies can vary wildly so make sure to shop around. The plan you will qualify for will greatly depend on your ability to answer a few health questions on an application and passing a basic check which may include MIB and pharmacy reports and more. Again, each company is different when it comes to medical history so check around and ask a lot of questions.

I hope that this article has helped you make a more educated decision. Please always feel free to ask us questions. Be well.