Term Life Insurance For The Elderly…5 Things To Ask Before You Buy

Term life insurance for the elderly is really death insurance. When considering term life policies for seniors, be aware that they do not build equity as permanent policies do. With a policy for the elderly, what’s being paid for is simply a death benefit that can be paid to beneficiaries if the insured dies during the policy period. You are placing a bet with an insurance company that you will die before the term of the policy expires. Having said that, term life may be the best way for you to ensure that your kids won’t be stuck with paying funeral expenses and any other unresolved debts you leave when you die.

So, let’s take a look at five important things you must know before you invest in term life insurance.

Does the insurance plan offer renewals?
One of the key features to investigate when comparing term life insurance for seniors is whether they offer renewal options. When the insured period is up, and coverage is still desired, a whole new policy will need to be taken out.

Some term life insurance for elderly policies have a renewal option where it can be automatically renewed. Generally, answers to a new lifestyle questionnaire, and a raise in the premium will also be needed in order to renew. Additionally, when comparing policies, ask whether the premiums are fixed for the full term of whether they adjust. Many insurance policies for the elderly have premiums that adjust every few years, which can significantly affect the amount that will need to be paid.

Is a medical exam required?
We have discovered term life insurance policies, from top ranked companies, that provide face values equal to $400,000 without a doctor’s exam. Instead of a medical exam, they use your answers on your application to decide if you are insurable. Even so, you must tell the truth. If you do die during the period of coverage, and the insurer discovers that it was from some condition you didn’t reveal on your application, they likely will deny the death benefits.

It’s also very likely an insurance company will look at your Medical Information Bureau (MIB) records. If they detect a difference between the MIB report and the responses you submitted in your application, they may well refuse to issue you a policy, cancel an existing policy or refuse to pay your death benefits. Maybe even worse, when you try to apply with another insurance company, you’d have to reply with a “yes” if they ask you if you have ever been denied coverage before. That could prevent you from ever getting a life insurance policy so, tell the truth when completing the application.

Is there an accelerated death benefit?
Before you purchase make certain that an accelerated death benefit is in your policy. Accelerated options provide you with insurance benefits before you die. Benefits are paid to you, so you can cover any extra health cost you require, such as nursing home care. It’s so essential to include it in your life insurance because of unforeseen illnesses and their effects on your life.

An accelerated option can be started when you’ve been diagnosed with either a terminal, acute, or chronic illness. Diseases like cancer are considered terminal, and an acute illness example would be heart disease. Chronic diseases include diabetes and arthritis.

Reputable life insurance companies will provide accelerated death benefits on a policy. It is also vitally important to know how the payout will be started. Each company is different, a few will give you a lump sum payment, while others will give you monthly installments. A wonderful thing about these policies is that if you completely recover you will not have to repay any of the benefits paid to you. Also, if you die any money remaining will be paid to the beneficiaries from your life insurance.

Is there a disability waiver of premium?
Basically, the insurance company will give up future insurance premiums, while you keep policy benefits. The waiver of premium rider could be included in any life insurance policy you purchase. It says that if you become disabled while you have your policy…and you are disabled for a minimum of 6 months…the insurance company will continue your policy and you won’t have to pay any premiums for as long as your disability continues.

It doesn’t matter how long you’re disabled…no premium payments will be required. When you recover from your disability, if you ever do, then your payments start again. You’ll owe nothing in back payments to the insurance company. The cost of the waiver of premium rider is minimal.

What about accidental death benefits?
Adding an accidental death and dismemberment rider (A D & D) to a term life policy is a good way to get extra insurance protection.

Depending on the rider insurance coverage you take with your term life insurance policy, it might also cover loss of sight or the loss of one or more limbs. Of course, you’d have to double check your policy as each company and policy will likely be different. One very important point to keep in mind is that A D & D Riders do NOT cover death by any form of illegal or crime related activities.

The rider also doesn’t pay for death by suicide or death from “natural causes” such as stroke or heart attack. Accidental death implies that an unexpected circumstance caused death that is unrelated to the body. This is where the term life insurance policy becomes important. While the insured would not benefit from the rider, they would most certainly benefit from the term life insurance policy.

A D & D riders also cover dismemberment. In the case of the accidental loss of one arm or one leg only one half of the death benefit would be paid to the insured. In the event that the insured person suffered the loss of two or more limbs (combination of arms and legs), then that would result in the entire face value (death benefit) being paid to the insured. In this event, the A D & D Rider would be terminated or waived because the entire face value of the death benefit/term life insurance policy would have already been paid out. Most A D & D Riders also include the sudden loss of vision and the same payment terms apply.

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