If you are doing research and shopping around for life insurance for an elderly father, then consider that the older your dad gets, the more difficult it is to find coverage. In other words, the window of opportunity narrows as a man gets older.
Many times children begin to investigate their parents life insurance coverage as they age and, a lot of times, you discover that your mom or dad either have no life insurance coverage or the policy they have is inadequate.
This article will go over the important facts to be aware of when looking for life insurance coverage for an aging man as well as basic things to consider when buying senior life insurance.
Things to Consider When Shopping for Life Insurance for Your Elderly Father
Buying life insurance for a 30 year old male is a different experience and a different market place than getting coverage for your 75 year old father. A lot of people understand that there is a difference but aren’t really sure what the differences are. There are a few basic things to understand. One thing to keep in mind is age and gender. Life insurance gets pricier as you get older. Life is also more expensive for men than women, so a policy for an older man is more expensive than coverage for an older woman (same age and similar health), simply based off of statistical data regarding life expectancy. They say women live longer.
With that said, you should be aware that 85 years old is the maximum age to buy a life insurance policy for an elderly man or an elderly woman. Believe it or not, there are plenty of families who obtain coverage for an elderly parent at this age. It is expensive, but for many the peace of mind is worth it.
How much more will it cost?
Let’s take a look at the same policy for a 75 year old man versus an 85 year old man. If you were to obtain a $25,000 life insurance policy for a 75 year old woman who is in average health, it would cost $2014 per year.
That same policy for an 85 year old man in average health is $4636 per year. You can see the difference. It is more than double the amount.
Does Your Elderly Father Have Enough Life Insurance?
These days the cost of living seems to increase year after year. This is a concern in all areas of a person’s financial life, and life insurance is no different. Your dad may have purchased what seemed like more than enough coverage 10 or 15 years ago, but when you look at it now, it seems inadequate. This is why it is important to sit down and review your parent’s coverage as they age – to make sure you know how much they have and discuss whether or not to add to it.
When thinking about whether or not to increase a policy, the first thing to ask is what is the policy intended to cover?
Many seniors and elderly obtain life insurance coverage just to make sure their funeral expenses are covered. This could mean that small and simple policy between $7,500 and $20,000 would be enough, depending on the type of burial they want.
What other things should be considered? Besides funeral expenses, you should also keep in mind other final expenses that come up when a loved one dies. This could be anything from final bills, to medical expenses, taxes, probate fees, and even court costs. These type of expenses could add up to several thousand dollars or more. There could be more expenses if there are debts left behind too, such as real estate or auto loans, and credit card balances.
Simplified Issue Coverage vs. Getting an Exam
There are two routes you can choose from when you think about getting life insurance for someone who is older. One route is to apply for policies that require a complete physical examination. This means that the insurance company will examine height and weight as well as blood and urine sample. These things will be scrutinized and it will take a few weeks to get the results. If your elderly mom is in great health then I recommend this because the rate will be lower.
If your mom’s health is not so great, then a simplified issue life insurance policy is a better option. There is an application with a health questionnaire and possibly a phone interview. The rate for a policy that is issued this way is a little big higher, but the insurance carrier offers some leeway when it comes to health issues.
Policy Ownership – How this Affects Your Father’s Policy
Policy ownership is an important area to pay attention to if you are helping your dad get a policy. There are various ways that a child can be involved in a parent’s life insurance coverage. One way is to assist them in researching rates, comparing policies, and going through the application process. In this scenario, your dad would be the owner and payor of the policy. In other words, he pays the bill and controls all aspects of the policy.
You could also be a beneficiary of the policy. If your elderly father purchases a $50,000 policy and designates you and a brother or sister as beneficiaries with a 50 / 50 split then you and your sibling would each receive $25,000 when your father dies and the benefit is paid out. As a beneficiary to your dad’s policy, you don’t have any control or rights regarding the decisions, features, or other aspects of his policy.
A third way to be involved in your father’s policy is if you choose to pay the premiums. This is something that children are doing more and more often as they find that their elderly parent doesn’t have adequate life insurance and their limited income makes it difficult to pay for a policy. So many children end up buying their older parents a policy so as to provide some protection to pay for funeral expenses, bills, and other costs when the die.
Another way to be involved in the life insurance process is to be the owner of the policy. The owner is the person who has control of the policy, meaning you have rights to make decisions. You can add or change beneficiaries, as well as choose various options and riders to the policy. The owner can also make decisions on whether to borrow against the cash value of the policy if it is permanent life insurance.
You and your father should have a talk and discuss which is the best scenario for your needs. A lot of times as our parents get older, they need assistance with payment and handling of their financial affairs so many parents find it comforting and useful for their kids to be involved in the decision making process.
Health Issues of the Elderly – How it Affects Life Insurance Rates
One of the inevitable aspects of getting older is the onset of health issues, whether minor or serious. Some seniors have some minor issues that come along with the aging process, while other seniors have major medical problems. Of course the rate is higher when more serious health issues are present, but the good news is that there are many companies who work specifically with seniors and the older population so there is flexibility and options in all scenarios.
Minor or common health concerns for an elderly parent would be something like controlled high blood pressure, controlled hypertension, and even well controlled type 2 diabetes. These are often considered minor health concerns and, depending on the company, don’t affect premium much (this is why it is important to do a thorough rate comparison because some companies have lower rates than others when it comes to various health issues).
In other cases, your aging parent may have a history of more serious health issues and chronic problems such as a history of heart problems, stroke, or some form of cancer. These are viewed as riskier to most insurance companies and because of that, rates are higher to offset that risk.
Some seniors and elderly who have a history of serious health issues are concerned that they may
What if I Can’t Get a Policy for My Elderly Father?
Children often worry about not being able to find life insurance coverage for their older parent, but there are actually many options available in today’s market place. I’ve worked with many seniors and their families who have been turned down and in many cases, it is because their hasn’t been adequate research. It is critically important to apply to the “right” company. What I mean is that every company has different criteria. Company A may view an 82 year old man who smokes and has a history of strokes as somewhat risky and offer him a policy with a higher rate, while Company B will flat out decline him.
Shopping around and comparing multiple rates is the most important part of obtaining an affordable and sound life insurance policy. Shopping around can save you hundreds, if not thousands of dollars over the life of your policy. On your end you just have to be open and honest with any details regarding your parent’s health history including any past or present health problems, prescription use, surgeries, and any other information that you think would be important to disclose. That way, you’ll be able to be matched up with the right company for your elderly father’s need.
Which Company Do I Choose?
With all the companies that are available to choose from, how does someone pick the best one? The easiest way to do that is to use a quote engine or database that includes companies that specialize in seniors and the elderly. It’s that simple. That is what we offer here – a fast and simple way to research and compare rates for seniors and the elderly so you get the best policy at the best rate for your unique situation.
Get started today. It is as simple as entering your zip code and clicking the quote button. You’ll be taken to a quote page where you can enter more details and then compare and review rates for your elderly father.