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Do you really need life insurance after 65? Maybe yes, maybe no – it all depends on your personal situation.

As we age, our need for life insurance decreases as we pay off our debt. So if you have no debt and no one who relies on you financially, then you may be one of those lucky people who doesn’t need a policy after retirement! However, most people don’t fall into that category.

In this article, we discuss who should purchase life insurance after the age of 65 and which type of coverage you should purchase, as well as sample rates for each type of policy.

Quick Article Guide:

1. Why You Should Purchase Life Insurance After Age 65
2. Which Type of Coverage is Best for My Needs?
3. Term Life Insurance – Pros/Cons and Sample Rates
4. Whole Life Insurance – Pros/Cons and Sample Rates
5. Universal Life Insurance – Pros/Cons and Sample Rates
6. We Can Help!

Why You Should Purchase Life Insurance After Age 65

Like mentioned before, many people may still have a little debt after retirement. Even if they don’t, they most likely have someone who is relying on them for financial support. In those cases, life insurance is a good investment.

Those aren’t the only two reasons why you should purchase life insurance after 65, however. If you want to leave an inheritance, fund a trust, maximize your pension, or establish an estate, you’re a good candidate as well!

All policies are not created equal, and you want to ensure that you choose the right one to fit your needs. Not sure which one that is? Don’t worry, we’re here to help. Let’s break it down.

Which Type of Coverage is Best for My Needs?

First thing’s first – what’s your need for life insurance? Do you want to leave behind an inheritance or estate? Do you want to secure debt or provide income replacement for a spouse?

The first option is Term Life Insurance. This type of policy is in effect for a certain number of years (the term), and provides level protection during that time period. If you have debt or have a spouse who would need income replacement should you pass, this is the way to go. Term policies are typically in increments of 5, such as 10, 15, 20, 25 or 30 years. The longer the protection, the higher the policy cost per month, so it’s important to determine how many years of protection you deem appropriate.

The other option is Permanent Life Insurance. If your plan is to leave behind an inheritance – whether that be for burial costs or just to provide for your beneficiaries – or you’d like to protect your estate from estate taxes (ugh, who likes those?!), this is the type of policy for you.

While there is only one type of term life insurance, permanent life has a few subcategories. The types of permanent life include: universal life insurance, whole life insurance, and guaranteed issue life insurance. Keep in mind that because these policies are permanent, they’re going to be more expensive than term life policies. With that said, term policies won’t issue a guaranteed payout, whereas permanent policies will!

Term Life Insurance: the Good, the Bad, & Sample Rates

Like stated earlier, term life insurance offers level (fixed) coverage and premiums for a certain amount of years. Generally, the minimum term is 10 years with a minimum amount of coverage at $100,000. While many companies offer term policies without requiring a medical exam, after you turn 65, it’s most likely that you will have to take one to qualify and get approved.

Most outlive their term policies, hence why it is much less expensive than permanent coverage. Your premium will be based off of things such as your age, health, gender, and hobbies. If you decide to renew your term policy after it expires, you can expect your premium to increase quite drastically.

Should you die during your term policy, a death benefit will be paid to your beneficiary or beneficiaries. However, there is no savings component to these policies. Let’s look at some of the pros and cons to term life insurance:

Pros of Term Life:

• • Much more affordable than other types of coverage

• • Most policies offer conversion options for permanent coverage (a nice perk, if I do say so myself)

• It allows for flexibility – you can choose your coverage and term amount

Cons of Term Life:

• • Requires a medical exam for approval after a certain age

• • Rates and coverage are only guaranteed for 10, 15, 20, 25 or 30 years

• • It can take six to twelve weeks for approval

• • There is no savings component

• Beneficiary only receives death benefit if you die during the term

Now that we’ve covered the good and bad when it comes to term life, let’s look at some sample rates:

Term Life Insurance Sample Rates: $100,000 of Coverage & 10-Year Term

Term Life Insurance Sample Rates: $100,000 of Coverage & 15-Year Term

Term Life Insurance Sample Rates: $100,000 of Coverage & 20-Year Term

*Monthly rates are accurate as of 03/01/2018 and are available to qualifying individuals in excellent health. Rates provided for illustrative purposes only.

Whole Life Insurance: the Good, the Bad, & Sample Rates

Now that we’ve covered term life insurance, let’s move on to the other type of coverage: permanent life insurance. First up – whole life!

Unlike term life, Whole Life Insurance provides lifetime coverage, a death benefit, and an investment component (a.k.a cash value). The cash value is tax-deferred, so you won’t have to pay any taxes on it while it accumulates.

With a whole life policy, You can normally get up to $50,000 in coverage without having to take a medical exam. Instead of taxing a medical exam, the life insurance company will review your medical and prescription history electronically. As long as you don’t have any serious health issues, you will most likely be approved.

A downfall of whole life insurance is that regardless of your health, all applicants pay the same premiums based on two things: age and gender. If you’re a smoker and in less-than-great health, this might be a good option. But for those who are healthy, this probably isn’t the best policy choice for you.

Here are some pros and cons to whole life:

Pros of Whole Life:

• • No medical exam required to get approved

• • Lifetime coverage

• • Guaranteed death benefit and tax-deferred cash value

• Many companies offer fixed rates until the age of 100

Cons of Whole Life:

• • Expensive for healthy and non-smoking applicants

• • Complicated policies that are hard to understand

• Mediocre investment returns

Alright folks; now that we know the good and bad about whole life, let’s move on to some sample rates!

Whole Life Insurance Sample Rates: $10,000 of Coverage to Age 100

Whole Life Insurance Sample Rates: $15,000 of Coverage to Age 100

Whole Life Insurance Sample Rates: $20,000 of Coverage to Age 100

Whole Life Insurance Sample Rates: $25,000 of Coverage to Age 100

*Monthly rates are accurate as of 03/01/2018 and are available to qualifying individuals in average or better health for their age group. Rates provided for illustrative purposes only.

Universal Life Insurance: the Good, the Bad, & Sample Rates

Ah, the other type of permanent life insurance: universal. Universal Life Insurance, as defined by Investopedia, is a type of flexible permanent life insurance that offers lifelong protection, as well as a savings element that is invested to provide a cash value buildup.

Unfortunately, the traditional universal life insurance is known for having an investment value that doesn’t keep up as it should with the policy’s annual and investing fees; so essentially, the payout isn’t worth what it costs. The policy rate also isn’t guaranteed, so your premiums increase as you age.

As an alternative to the traditional universal life insurance, we recommend Guaranteed Universal Life Insurance instead. Guaranteed universal life insurance (GUL), also known as “No Lapse” life insurance, is a revamped type of universal policy that works very similarly to term life insurance – it guarantees rates and coverage until the age of 85, 90, 95, 100, 105, 110, or 121. You get the guaranteed (fixed) rates of term life insurance, but the longevity of whole/permanent life insurance. It’s a win-win!

If you plan on funding a trust or protecting an estate for your beneficiary/beneficiaries, guaranteed universal life insurance is the way to go. It is a much cheaper alternative to whole life insurance, and allows you to have more coverage.

Here are the pros and cons of GUL:

Pros of Guaranteed Universal Life:

• • Much easier to understand than whole life policies

• • More affordable compared to other types of permanent coverage

• • Fixed rates until the age of 85, 90, 95, 100, 105, 110, or 121

• No risky investing involved

Cons of Guaranteed Universal Life:

• • You need to undergo a medical exam for approval

• • Doesn’t accumulate significant cash value

• • Usually takes six to twelve weeks for approval

• More expensive than term life policies

Guaranteed Universal Life Insurance Sample Rates: $100,000 of Coverage to Age 90

Guaranteed Universal Life Insurance Sample Rates: $250,000 of Coverage to Age 90

Guaranteed Universal Life Insurance Sample Rates: $500,000 of Coverage to Age 90

*Monthly rates are accurate as of 03/01/2018 and are available to qualifying individuals in excellent health. Rates provided for illustrative purposes only.

Do You Still Have Questions? We Can Help!

We understand that we threw a whole lot of information at you. If you’re still not sure which policy is right for you, don’t worry! We’re here to help.

If you would like to receive an accurate quote based on your age and health, as well as which type of policy and amount of coverage you should choose, give us a call. Toll-free, no obligations: (855) 902-6494. Our agents are experts at matching their clients with the best policy available, and we work with over 60 highly-rated life insurance companies.

In addition, our agents do not work off of commission or have sales quotas to reach. This means that you can ensure you’re getting real advice and truly being matched with the best company possible for your needs.

Our services are completely free, and there is not cost to apply for coverage. Give us a call today, or you can request a free online quote below to compare rates from more than 60 life insurance companies in less than a minute.