Life insurance has a place in every financial plan. The purpose of a life insurance policy is to help protect your assets and provide for loved ones when you’re gone. It’s not uncommon for many life insurance policyholders to re-evaluate their insurance needs as they age.
The reason is simple: the priorities of a 30-year-old differ significantly from those of a 40- or 50- year old.
If you’re considering buying life insurance, you should know that most life insurance policies are more expensive after you turn 50. In addition to paying higher costs, qualifying can prove challenging depending on your overall health.
Finding affordable life insurance can be difficult, but understanding what options are available and what to look for as you shop will help you find a policy that’s right for you.
Why life insurance is more expensive over 50
Most life insurance companies charge higher monthly premiums as you age. There are several reasons for this, but most of the reasons center around the fact that the typical person experiences more health problems after 50 years of age. In fact, approximately 75 percent of Americans over the age of 50 are taking one or more prescription drugs on a regular basis.
If you have an existing health problem, qualifying for life insurance may be challenging depending on the severity of the condition. If you have “moderate” or “poor” health, you may be considered a higher risk to insurance providers.
To offset this added risk, insurance companies charge higher premiums to ensure they have accumulated the necessary funds to pay the death benefit should the insured party pass away early.
Tobacco use is another common reason for higher premiums. If you’re over 50 and use or have used cigarettes or chewing tobacco, you can expect a higher insurance premium. Smokers are more likely than nonsmokers to develop heart disease, have a stroke, or develop lung cancer. Because of these added health risks, tobacco users are charged higher rates.
What to look for in affordable life insurance
It’s likely your insurance needs have changed since you first purchased a life insurance policy. Meeting with your agent periodically to review your coverage is a good way to ensure you’re always protecting what matters most.
If you’re purchasing life insurance for the first time, start by evaluating what obligations you have. Is someone financially dependent on you? Do you have outstanding debts like a mortgage, car payment, etc.?
Ask yourself, “Whom (or what) am I trying to protect with this policy?” Answering this question will help you know what to look for in your life insurance policy.
Are you trying to replace the income your family would lose if you passed away? Do you want to cover funeral costs? Pay off a mortgage? Look for a policy that can address those specific needs should you pass away.
Deciding what sort of policy you need, how much coverage you should have, how long you need it for, and how much you can afford will help ensure you select the right policy for you and your family if something happens to you.
Shopping for life insurance is a lot like shopping for a new car: the cost may be relatively the same, but the specific features can vary significantly. When shopping for coverage, carefully compare the benefits offered by each insurance provider. Don't automatically choose low-cost life insurance just because the cost is attractive. There may be a policy with features more closely aligned with your needs even though it's more expensive.
Because premiums are higher for those 50 years old or over, finding affordable life insurance can be a challenge. Choose a policy you can reasonably pay for today, tomorrow, and the foreseeable future.
Your circumstances could change at any moment, so it’s important to choose something that won’t become a burden in the future. Having to cancel a policy because it’s too expensive can cause you to lose the premiums you’ve already paid and can impact your ability to qualify for coverage in the future if your health changes.
That’s why it’s so important to make sure the coverage you select is affordable.
What’s the best life insurance for people over 50?
Life insurance should be customized to your specific situation. Taking a few moments to think about what’s important to you will help you determine what coverage is best.
In general, whole life insurance is usually the best life insurance for people over 50. The coverage and premium typically remain the same throughout the life of the policy and some plans can accumulate cash value.
In contrast, term policies can be difficult to qualify for as you get older and may not offer the permanent protection you’re looking. Also, most term policies do not accumulate cash value.
Depending on your needs and age, final expense life insurance may be best for you. Commonly called “burial insurance” or “funeral insurance,” it’s a type of whole life insurance specifically designed to address any final expenses you leave behind - such as unpaid medical bills and funeral costs. Some final expense policies are considered inexpensive life insurance because coverage can often start as low as $15 a month.
Funeral expenses alone can cost up to $9,000, but having even a small final expense policy in place can help your family cover these costs.
Because the premium and coverage amount don’t usually change for whole life policies (as long as premiums are paid), final expense insurance is a great option if you are over 50 or if your health deteriorates. However, the longer you put off purchasing such a policy, the more expensive it will be and the more likely your health will change. Locking in an affordable insurance rate while you’re in good health may save you hundreds of dollars in the future.
Final expense life insurance typically offers smaller coverage amounts than term insurance, making them more affordable and easier to qualify for.
Because the coverage amount is lower than most other types of life insurance, some final expense policies don’t require a medical exam to qualify. Many policies can be issued based on answers to health questions on the insurance application.
Finding affordable life insurance over 50 can be challenging – often those over 50 have different needs than younger applicants. If you’re looking for a policy that’s easy to qualify for and protects your loved ones from end-of-life expenses, you may want to consider final expense insurance from Lincoln Heritage Life Insurance Company®.
We’ve been protecting seniors and their families for over 50 years. Our policies are easy to qualify for, don’t require a medical exam or physical, and give your family the cash insurance benefit they need within 24 hours of claim approval. We can issue your coverage based on your answers to health questions on our one-page application.
To get a free final expense insurance quote, click here.< Back to Consumer Resources