While it may be a bit more challenging for a senior citizen over the age of 80 to purchase a life insurance policy, it is possible. More life insurance companies than ever are now willing to offer short and medium-term coverage for seniors, and some insurers even choose to specialize in that niche market.
While there are coverage options available for 80-year-olds, they certainly are more limited. The costs of premiums will likely be higher, although there are many variables which get taken into account when rates are determined. Factors in addition to age, such as health history, family health history, and driving history can influence the cost of coverage. Seniors have a higher likelihood of being classified as a “standard” or even “substandard” risk, which are the two most expensive risk categories to insure.
The two biggest concerns of seniors aged 80 and older who are seeking to purchase a life insurance policy is whether or not they will medically qualify for coverage, and whether or not the rates will be affordable.
Octogenarians in good or great medical condition, or who suffer from only very minor health issues that can be treated easily with over-the-counter remedies, will be given the best rates. Some may qualify for a limited-term plan that may provide full underwriting coverage for as long as 10 to 15 years. Another option is whole-life insurance, also known as universal life insurance, or permanent life insurance. This is insurance that will remain in force for the remainder of the insured’s life. Something that most people are unaware of is that it is typically easier to get approved for permanent life insurance coverage than it is for term life.
If the senior seeking life insurance suffers from major health issues, the plans available to them will be extremely limited. Sometimes, in the case of older applicants, policies do not provide death benefits for the first couple of years after coverage is purchased. This is known as “graded life insurance.” Should the insured pass away during this time period, the designated beneficiary will receive a payment amounting to the total value of the premium payments made, plus accrued interest. Should the death of the insured occur after the specified times period has elapsed, the beneficiary can expect to receive the face value amount of the policy in full. In general, most seniors 80 or older will not find themselves eligible for a policy bearing a large face value without paying a very high premium.
“Final expense insurance” is a type of life insurance coverage that is designed for beneficiaries to use to pay funeral or burial expenses, in addition to any estate-related expenses and outstanding debt. A burial policy may be available to seniors up to and including the age of 85. Once enacted, the policy will cover the insured individual for the duration of their life, with constant premiums. A burial insurance policy does not require a medical examination.
Some older citizens, those who are still involved with running and owning their own business, have bigger issues than burial costs to be concerned about. They are worried about finding ways to preserve the continuity of their business and to transfer ownership after they are gone. Other seniors may be faced with the task of needing to assure a lender (such as a bank or other financing company) that a loan will be paid back.
If a senior over the age of 80 has any of the above-mentioned business concerns, it would be best for them to seek out a life insurance broker that specializes in handling those types of cases.
