Insurance purchases can be confusing as you weigh the requirements, coverage limits and monthly premiums to determine if you even need to take out a new policy. This can be especially true when you consider niche markets such as senior life insurance. Here are some of the basic features and benefits you can expect from most senior life insurance policies (be sure to read the fine details for each company you are considering).
Senior life insurance plans are whole life plans; hence, benefits are paid upon the death of the insured. Whole life policies generally carry with them stable monthly premiums, so payment amounts remain predictable. Further, whole life policies come with guaranteed cash value which the insured can borrow against. Loans against these policies are tax-free. Benefits for senior life insurance policies never vanish and can only be canceled for non-payment of premium.
Wondering what features make senior life insurance so attractive? In addition to the benefits listed above, medical examinations are not required in most cases. However, insurers have differing requirements and policy applications can be denied (unless otherwise noted) based on information provided within the application. Policy holders can opt for an accidental death benefit rider and can increase the death benefit amount by requesting a paid-up additions rider. True to its name, the latter option does require the policy holder to pay additional premiums.
Many insurance agencies market senior life insurance policies as final expense insurance, directing the insurer to send benefit payments directly to the funeral service provider indicated at the time of the policy application. Benefits are directed to the funeral service provider, with excess funds in most cases sent to the insured’s estate or designated beneficiary. Because final expenses are now averaging between $7,000 – $10,000, having senior life insurance coverage can, indeed, reduce the stress and financial pressure on a family following the death of a loved one.