According to the 2017 Insurance Barometer Study conducted by LIMRA and Life Happens, 83 percent of Americans said that they would think more intently about getting life insurance if it was less difficult to understand. The study also found that seniors in particular had the most difficulty understanding this type of financial product. It is common for elderly people to be overwhelmed by insurance terms and policy options, and some may be tempted to just skip them altogether. However, life insurance can be very important if you want to leave a financial legacy to your loved ones. This article will provide simple and helpful information about senior life insurance.
What is Senior Life Insurance?
“Senior life insurance” is a term that is used to describe life insurance that is purchased by elderly people to cover costs that will be incurred when they pass away, such as funeral costs and final expenses. The main purpose of this type of insurance is to ensure that your loved ones will have to bear minimal financial burden upon your death. The maximum amount of compensation that your loved ones will receive depends on the type of life insurance policy you purchase.
If you do not have life insurance, your loved ones may have to face substantial financial expenses when you pass away. Funeral costs have risen significantly over the past decade or two, and they have caused great financial difficulties for many families. Getting life insurance is a way to protect your loved ones from being burdened with funeral and other death-related expenses. Besides providing compensation for funeral expenses, a senior life insurance policy can also cover medical bills and outstanding debts such as loans and credit card bills, as well as provide for a dependent with special needs.
One of the most important benefits of senior life insurance is that it can serve as a form of income replacement. If your spouse financially depends on your pension income, he or she will be in a difficult situation when your pension ceases following your death. Life insurance benefits are usually not taxable, and they are paid in a lump sum, allowing your loved ones to use the proceeds freely.
Types of Senior Life Insurance
Basically, there are two kinds of life insurance for seniors, namely, whole or permanent life insurance and term life insurance. Whole or permanent life insurance is more suitable for younger people, because it offers permanent coverage and enables them to save money and earn dividends. Term life insurance, on the other hand, is usually a better choice for seniors. It keeps you covered until the term runs out, and it is much more affordable than permanent life insurance. Other types of senior life insurance available include guaranteed life insurance, survivorship life insurance, funeral insurance, and “no medical exam” life insurance.
In order to find the best senior life insurance policy, you need to spend some time doing comparison shopping. There are life insurance comparison sites that enable you to get free quotes and compare policy options from different insurance providers. Also, keep a lookout for insurers that offer discounts.