Comparison of Senior Life Insurance And Alternatives
What is Senior Life Insurance?
A senior life policy is usually a fairly small face value whole life insurance policy. By a small face value, I mean from a couple of thousand dollars to twenty or twenty-five thousand dollars. The policy is usually intended to help a family pay expenses that come up at the end of life. These examples could includeerals, debts, travel, and compensating family members for losing time at work. If any money is left over, the beneficiaries of the policy are entitled to keep it to use however they wish.
Advantages To Senior Life Insurance
There are some advantages to having a policy. Funerals are expensive. It can be very tough to come up with the cash to pay for one. Other expenses also tend to crop up when a loved one dies. The policy can be a source of cash to help pay for these things.
It can also be a way to leave cash to the beneficiaries. Any money that is not needed to pay for end of life expenses should go to the people who are named on the policy. In most cases, there are no taxes due on the proceeds from a life policy.
Is Senior Life a Low Cost Choice?
Because the face values are small, many policies are quite affordable for seniors or their families. However, we also need to decide if these policies are a good value. That will depend upon a lot of things.
Take the example of an eighty year old female. A typical premium for an $ 11,000 policy might be about $ 95 a month. In this example, the policy will be paid up at age 95. After her 95th birthday, the insured person will not need to pay more premiums in order to be covered.
Keep in mind that this is just an example, and it is not meant to illustrate any particular insurance policy. Rates will vary by age, health, location, and insurance company. In order to get accurate quotes for yourself, or for a loved one, you can find an online life insurance quote form.
In this example, if the insured person does survive until age 95 when the policy is paid up, the premiums would have adjusted to over $ 17,000. This is probably more than the $ 11,000 face value of the policy! It would be easy to say that, in this case, the family would have been better off by putting the money in a savings account.
Insurance is about risk though. If the insured person would pass away in the first few years of the policy, the premiums paid would be much lower than the face value. In this case, the family would pay less than the face value for the policy.
So it is hard to say for sure if a senior life insurance policy will be a good value or not. Nobody, can predict the future. We also spend a lot of money on car insurance policies that we hope we never have to use!
Shop Around For Low Cost Senior Life Insurance
I would advise anyone to compare senior life premiums and policies before they buy! The rates for policies that are advertised on TV or the internet may not be the lowest ones you can find. You can, however, use an online quote form to shop the market to be sure you find the cheapest rates and best policies for your family.