If you are over 50, you may still count on many years of life. According to Public Health England, in a press release dated the 12th of February 2016, life expectancy for those in their later years is now higher than it has ever been.
These days, in other words, 50 is no age at all. But as anyone of any age probably knows, it is never too early to start thinking about life insurance.
For the over 50s, however, there are certain benefits and advantages you may enjoy that are not available to those who are younger than you. Life insurance over 50, may carry an especially attractive appeal. These are some of the reasons why:
- over 50s life insurance is a special form of whole life insurance – that is, it pays out an assured cash benefit whenever the beneficiary dies rather than only within the defined period of a term life insurance policy;
- the assured cash benefit is return for the payment of monthly premiums for the remainder of the insured’s life – although many such policies waive the collection of premiums once the insured has reached the age of, say, 85 or 90 (depending on the insurer);
- unlike some other forms of life insurance, acceptance is guaranteed, without the need for any kind of medical examination or questionnaire; and
- the cost of the monthly premiums is likely to be fixed at the same rate for the duration of the policy.
Life insurance for the over 50s may serve a number of purposes, including the following:
- the cash benefit may be used to pay for your eventual funeral arrangements;
- it may be used to settle any outstanding debts or lines of credit upon your death – personal loans or credit card balances, for instance;
- you might use the policy to provide a financial legacy for your dependents, family or loved ones; and
- a whole life insurance policy such as this might be written into trust and, in that way, used to help your surviving beneficiaries avoid inheritance tax liabilities.
Points to be aware of
Life insurance for the over 50s works in a simple and straightforward way. The amount of the cash benefit eventually payable of course depends on the amount you are paying each month in premiums. This in itself raises a few points which you might need to keep in mind:
- the policy represents a long-term commitment, so you need to be confident that you are going to be able to afford the monthly premiums over the long term;
- if you stop paying the premiums, the policy expires and there is no cash-in value;
- since you are paying premiums for what may be a very significant number of years, it is possible that the final cash benefit is less than the amount you have paid in premiums; and
- the effects of inflation may mean that the future value of the assured cash benefits is less than the same amount at today’s prices.
Provided considerations such as these are kept in mind, over 50 life insurance may offer a helpful way of helping you plan your future finances.