Posts Tagged ‘elder care’

Senior Life Insurance Choices

Thursday, June 3rd, 2010

Can you believe how many seniors do not have a life insurance policy?

There may be some people who never bought a policy, but I think most younger people purchase coverage at some point. They tend to let it lapse or expire without replacing it. Some workers get covered through jobs, but then quit or retire, and then lose the employee benefits. But just because older people lack coverage does not mean they do not want or desire that coverage. Some could use it to help settle a business, pass on wealth, or even pay for a funeral. Older people can still find reasons to purchase a policy!

The reaons that an older person matter, but what is really important is that seniors can find a variety of products that are being marketed to them today. The top insurers recognize this growing demand, and they are responding with products that will answer this need. Rates will be higher than they would be for a 50 year old, but maybe not shockingly so.

Some things actually work in the older person’s favor. They may have a more mature lifestyle than younger people. Seniors may have survived to a ripe old age because of the type of good health habits that life insurance companies love. They are also more likely to be financially stable, and of course, insurers like applicants with good credit these days.

Lower face values can also hold down premiums. If an older person only needs ten or twenty thousand dollars worth of life insurance, it will be a lot less expensive than if they needed a million dollars worth. Hopefully, by the time they are older they will have already handled some basic obligations like getting a home loan paid off or sending kids to college.

A cash value life insurance is also a useful tool in other ways. It can actually build a cash account that can be cashed in, borrowed against, or used as an asset. It can also be used in a senior life settlement arrangement. So some life insurance does more than just provide a death benefit. It can be a financial tool to use while the insured person is still alive.

May we help you look for life insurance over 70? Find out if you are too old for life insurance..

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Life Insurance Alternatives Over 50

Monday, March 8th, 2010

Do people over 50 years old have any choices if they want to buy life insurance? Today, insurers consider older people a big market, and they do provide many different products. Because people are actually living longer and more productive lives today, rates may be actually be affordable too. It is certainly possible for baby boomers and seniors to find a policy if they want it.

Why are baby boomers and seniors looking for policies? At thirty or forty, a lot of us bought a twenty or thirty year term life insurance policy. That seemed like plenty of time to save money, get our kids educated, and pay off our mortgage. We figured that by the time we were fifty or sixty, we would have everything in order, and we would not need coverage any more.

How did that idea work out for you? In many cases, it did not work all that well. Our kids took longer to get off on their own than we planned. Maybe they haven came back home, and maybe they have their own kids now. Those mortgages we planned to pay off are still there because we moved or took out another loan to cover some expenses. And job losses or other problems meant that our savings just never really grew like we thought they would.

You may also think that we should already have coverage by the time we get to middle age. Most of us did have some sort of policy in our lives. But our term policies may have expired after 20 or 30 years. Thankfully we outlived them! Or we may have had coverage from a group policy at work. But we left that job long ago because we quit or retired. So now we find ourself older, but without any coverage.

How should we shop for a policy at our age? Well, before you purchase any policy, you should sit down and think about what you want that policy to do for you. There are a lot of reasons that older people purchase life insurance policies, and you need to uderstand what you want out of yours.

If you just want insurance, consider term. Premiums are cheaper anyway, and that will be important because an older person is likely to cost more to cover than a younger person. Even if you are middle aged, or in retirement age, you may still be able to find an affordable term policy.

You may want to find a term policy that you can convert to whole life later. These will not require you to prove you are healthy as long as you make the conversion within the specified time limit. That way you can have cheaper term now, and you can have the option to covert to a whole life insurance policy later!

If you want to use your policy to build an asset for yourself, or for your family, you probably want to consider whole life. After time, it can build a cash value which can be handy. You could use it to borrow against, cash in, or in a life settlement transaction. In any case, you will have lifetime coverage.

How much will this cost you. Premiums will vary by many factors. These include the size of the death benefit, the type of insurance, your age, and your general health. An experienced insurance agent should be able to help you explore your options. Just be careful if they seem too concentrated on one type of policy.

Also consider Single Premium Life vs Annuities for retirment planning.

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Single Premium Life Insurance Advantages and Disadvantages

Wednesday, March 3rd, 2010

Are you planning for a secure retirement and eventual transfer of your estate? You do not have to be very wealthy to benefit from this. Let us look at one product that is becoming more noticed these days with advisors and people who are making future plans. This is called single premium whole life (SPLI).

The most obvious difference is that you make one large cash payment when your coverage begins. You are probably used to having a monthly bill! That one lump sum funds your coverage, and so you do not have any more payments to make.

So you see that you have given the insurer a certain amount of money. In return, they issue you a policy for a sum that is probably a few multiples of the original amount. Many people are using this product to fund their estate.

Look at the example of a healthy 70 year old who retired from the public school system. Her savings and teachers pension enable her to live well. But she also has another $50,000 she inherited from her own parents. She could take this cash and fund an SPLI for, let us say, $200,000. This way she sets up a nice estate to pass on to her kids and grand kids.

The paragraph above is only meant to illustrate how this works. The amount of cash you would have, and the death benefit you could buy, depend upon different things. As with any other life insurance, your premium and coverage amount will depend upon age, health, etc.

What types of people are happy with a product like SPLI? Well, it seems to work out very well for those with a few thousand dollars that they do not expect to need in the near future. And of course, it is an option for those who would like to take that money and turn it into more money for their estate.

Be sure you will not have to use the money for a few years. In the first few years, policies can impose fees and surrender charges. So it is probably not the right life insurance if you are not sure if you will need the money to live on.

One other single premium life insurance advantage is the fact that this large payment will allow your policy to grow value fast. Have you seen normal policies where it may take 5 – 10 years to have a cash value? Once your policy has a cash value, you can use it to borrow against. You can also cash it out. So in addition to having coverage, you also have set up an emergecy fund for future use.

Accelerated death benefits and nursing home confinement provisions are another feature. In some cases, the insured person can actually use part of the face value while they alive!

There could be some disadvantages to single premium life insurance. Remember that early cash outs can incur surrender fees. You lose some of the tax advantages of regular life policies too. And of course, you do need to have a lump sum of cash to fund it.

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