As our parents hit age 80 and beyond, it is inevitable that we start thinking about what life will be like without them. We think about a lifetime of memories but the other thought that comes to mind is death and what comes along with that. Unfortunately a stressful area for many children of elderly parents is the the thought of the expenses that come when a parent passes away. This is why many children and parents re-evaluate their life insurance coverage in their eighties – to make sure it is adequate.
Expenses Incurred Upon the Death of a Parent
Depending on your parent’s financial situation and the way their assets are structured, there could be several expenses that need to be handled upon their death. Here is a general list to consider when you are thinking about getting a life insurance policy to cover these things:
- Funeral Costs. Depending on the type of burial you choose for your parent (or the type that they have expressed that they want to have), the average funeral these days is well over $6,000.
- Unpaid Bills. If your parent was ill before they passed away there could be medical bills left behind. Other common expenses are final bills such as bills that come along with owning a home – water, gas, electric, as well as taxes and insurance.
- Taxes. Depending on the way your parent’s assets and estate are structure, there may be estate taxes to pay.
These are things to keep in mind when you decide on which type of life insurance to purchase and how much of a policy to get for your elderly parent.
Term Life Insurance At Age 80 and Beyond – The Pros and Cons
Term life insurance is a temporary form of insurance protection that lasts for a certain number of years. Because of this, it is cheaper than permanent life insurance that will last for the duration of your life, as long as you pay the premium.
With term life insurance, you choose the term and the rate is determined based on your age and the length of the policy. The challenge with term life for a man or woman in their eighties is that the terms offered are typically short and because of the age, the policy can be expensive.
Many companies stop at age 80 when offering term life insurance but there are some companies that will cover you through the age of 85. At that time, the policy would expire but some companies will give the option to convert the policy to permanent life insurance without a medical exam.
So here are the pros and cons of term insurance for a parent in their eighties:
- Cheaper than whole life insurance
- Bigger face amounts
- Can often be converted to permanent life insurance (though premiums would increase based on age)
- Expensive due to age
- Temporary. Most companies won’t insure you past age 85
- Many companies require a complete medical exam for larger policy amounts
If you are thinking about getting term life in your eighties or for a parent in this age range, be sure to weigh the pros and cons. Another option is to get a decent sized permanent life insurance policy. It will cost more initially but it will never expire.
Get a Free Rate Comparison for Your Aging Parent
As your parents reach age 80 and beyond, the options for affordable life insurance become limited but the good news is that there are many highly rated companies that offer life insurance to this age group and have experience underwriting the older population. This benefits you and your parents because companies that work with older men and women understand the health issues that come along with age and price their policies competitively.
Get a rate comparison today and compare life insurance rates from several companies and choose the one that is best for your parent’s needs.