How to Get the Best Senior Life Insurance

How to Get the Best Senior Life Insurance: 
Your reasons for buying senior life insurance should guide your decision on the types of life insurance to consider. Here are some tips for seniors buying life insurance.

Avoid graded death benefit life insurance

It’s best to have life insurance that pays the full death benefit from day one. Therefore, you’ll want to consider a traditional life insurance policy and avoid a “senior policy” that has graded death benefits. With a graded death benefit policy, your beneficiaries won’t get the full death benefit if you pass away from a non-accident cause within the first two or three years of owning the policy. For example, if you die from pneumonia a year after buying life insurance, a graded death benefit policy will pay your beneficiaries only a refund of the premiums you paid with some interest. If you die in an accident, such as a car crash, these policies will typically pay the full death benefit at any time.

Don’t be rushed into a life insurance purchase

Financial predators often focus on seniors. They may try to get you to purchase unnecessary coverage or a more expensive policy than you need. Be wary of anyone who tries to rush you into making a decision or discourages you from discussing a proposed policy with a family member or trusted advisor.

Don’t be sold on policy projections that aren’t guaranteed

Life insurance policies that can build cash value will have “policy illustrations” that show projections for costs and cash value over time. For some types of cash value policies, not all amounts shown in an illustration are actually guaranteed. “Beware of ‘advisors’ offering policy reviews comparing non-guaranteed premiums, cash values, and/or death benefits for some limited number of products,” says Barry Flagg, founder of Veralytic. These sales practices are now considered “misleading,” “fundamentally inappropriate” and unreliable by the financial, insurance, and banking industry authorities.

“Insist that quotes include year-by-year disclosure of costs, often referred to as detailed expense pages or policy accounting pages,” says Flagg. Work with an advisor who will explain what’s guaranteed and what’s not. Insurance agents and advisors should be able to benchmark a policy’s internal policy costs and historical performance against the insurer’s peers, just like you do for other assets in your portfolio, says Flagg.

Get professional help

Because seniors are likely to have health issues, it’s especially important to work with a qualified life insurance advisor who can help you compare policies from multiple insurance companies. Your advisor should review your medical history and send informal (anonymous) queries to multiple insurance companies to determine the best available rate for you. By doing anonymous inquiries, you’ll save time and avoid any possible application denials.

Don’t base your decision solely on cost

Price is a critical factor when choosing a life insurance policy, but you shouldn’t base your decision only on cost. Check out financial strength ratings for the insurers, such as AM Best ratings. Research the available life insurance riders for the policies you’re considering. Life insurance riders allow you to add on coverage. Some riders let you access your death benefit while you’re still living for qualifying circumstances, such as accelerated death benefits for chronic or terminal illness, and long-term care riders. Once you’re comfortable with a list of insurance companies, you can get quotes to find the best senior life insurance policy for you.

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