Buying term life insurance over age 50 is more common than many people think. People who bought life insurance in the 20’s and 30’s are realizing they have policies that are expiring or close to expiring now in their 50’s and 60’s.
The reasons to buy life insurance shouldn’t be about how old you are. People buy life insurance for numerous reasons: Some folks would still like to have life insurance just for the sake of security to protect their loved ones. Others may be getting married for the second time and want to protect their new spouse or perhaps to cover a new mortgage.
If you’re reading this article, you are probably wondering if you can still find an affordable term life insurance policy over age 50. Well the good news is – Yes you can!
I’m going to give you some tips on how to get the best rates for life insurance over 50 as well as types of policies you may want to consider.
Term Life Insurance Over Age 50
Most people buy term life because of its simplicity and affordability. Simple, because the death benefit and payments remain the same for the duration of the policy. Affordable, because term insurance provides people with the highest amount of coverage for the lowest amount of cost.
The Three Kinds of Term Insurance
Annual Renewal Term (ART): The cost goes up each year with this type of policy as you get older. For younger people, this is the most affordable way to buy life insurance since the rates are very inexpensive. But for someone over age 50, this type of policy is probably not appropriate.
Level Term Insurance: Probably the most popular type of policy because the rates do not increase but stay level. However, at the end of the term period the costs increase dramatically. Depending on your age, you might be eligible for term lengths of 10, 20, 25, or 30-year term lengths.
Decreasing Term Insurance: Mostly associated with mortgage insurance. It is the opposite of ART. Instead of the costs increasing each year the premiums and death benefit decrease each year. The theory behind this type of coverage is that as your mortgage goes down, less death benefit is needed to pay off your debt.
The downside of every type of a term policy is that they all cover a temporary need. When you purchase a term policy, you are betting that you will die within the term. The insurance company is betting that you won’t.
For instance: If you buy a 20 year term policy and die one day after the 20th year, there is no coverage. At this stage in your life and you believe your insurance needs are only for the short term, then term is the best life insurance over age 50.
Tips for Buying Term Life Insurance Over Age 50
1. Compare Multiple Quotes – Rates vary between companies. Utilize the services of an independent agency like Behr Insurance for get multiple quotes. We work with over 30 different insurance companies and we don’t have to push you to one specific company.
2. Consider Your Term Options Wisely – Policies are available for 5, 10, 15, 20, 25 and 30 years. Don’t pick a shorter-term period because it’s the cheapest option if you might need coverage for a longer time period.
3. Know Your Payment Options – Level term policies are guaranteed to provide level coverage and pricing that is guaranteed not to increase. However, paying premiums monthly incurs a convenience fee or finance charge that will actually cost you more. Paying annually will save you money.
4. Check the Company’s Financial Ratings – Choose an Insurance company with high financial ratings of at least “A” (Excellent) or better by A.M. Best and the other financial rating services such as Standard and Poors, Moody’s and Fitch.
Over 50 Life Insurance – How to Get the Best Rates
Life insurance rates are based on your age and health. Other factors include, family history of heart disease, diabetes or cancer. If a family member has been diagnosed or passed away from these serious illness, it could impact your rates.
Lifestyle habits can make your policy more expensive as well. If you smoke, participate in hazardous sports such as scuba diving or rock climbing, the insurance company will consider you a higher risk and could charge you more for your policy. Obviously, people who are in good health with a healthy family history, will get the best rates.
The following chart will give you some idea of what rates could be for a healthy non-smoker male or female.
The best way to get better quotes from the insurance company is to maintain a healthy lifestyle. Regular exercise and a healthy diet can help you live longer and in the insurance company’s eyes, that is favorable to lower your rates.
What If I Can’t Qualify For Coverage?
Many people over 50 believe they can’t get approved for life insurance if they have pre-existing health problems but this is rarely true. We have been very successful finding coverage for people in their 50’s, 60’s and even in their 70’s.
Each insurance company uses different criteria to approve a policy. One company may decline your application while another may approve it. This is why it is important to work with a knowledgeable and independent agency that can assess your health condition and offer the best company for your situation.
For example; one company might automatically offer a person substandard rates because they smoke. Knowing what we know about the dangers of smoking, this makes perfect sense. But on the other hand, some insurance companies specialize in offering policies to smokers with reasonable rates. If you unknowingly applied to company A that penalizes someone who smokes, you would be paying much more than if a knowledgeable agent recommended you apply for company B.
If you can’t, however, get approved for a traditional policy, there are guaranteed issue policies or better known as burial insurance for people over age 50. These types of policies are designed for individuals with serious health problems and do not require a medical exam. However, there is usually a 2-3 year waiting period before the full death benefit goes into effect.
Term Life Insurance Over Age 50 – Get Started Today
The first step when shopping for term life insurance over age 50 is to work with an independent agency that can shop several company options on your behalf. Our agency works with more than 30 insurance companies so we impartially shop the major insurance companies to find you the best policy at the best rates.
Prices can vary from each insurance company so it is important to shop around. Get a free no obligation quote today by contacting us at 914-633-1717 and compare multiple quotes for term life insurance.