At 65+, life insurance salespeople will pitch you whole life policies with high commissions. Most seniors do not need them. Here is what you actually need — and what is a waste of money.
When You Need Life Insurance After 65
- You have dependents relying on your income — if your spouse cannot live on your combined retirement savings alone, a term policy may make sense
- You want to cover final expenses — burial/cremation costs average $7,000-12,000. A small “final expense” policy ($10,000-25,000) is often sufficient
- You have outstanding debts a spouse would inherit — mortgage, co-signed loans
- Estate planning / tax purposes — for high-net-worth individuals only
When You Are Being Sold Something You Do Not Need
- Whole life / universal life as an “investment” — the commissions are high (often 50-100% of your first year premium), the returns are poor, and the complexity hides fees. Buy term and invest the difference.
- Guaranteed issue policies for healthy seniors — these are for people who cannot qualify for regular policies due to health. If you are healthy, you will pay 2-3x more for guaranteed issue than for a medically underwritten policy.
- Children’s life insurance — life insurance is income replacement. Children do not have income to replace. This is almost always a bad purchase pushed by agents for commission.
What to Buy Instead
For most seniors: a level term policy (10-20 years) for income replacement if you have dependents, plus a small final expense policy ($10,000-25,000) to cover burial costs. Total cost should be under $100/month if you are in reasonable health. Shop through an independent broker who represents multiple companies — not a captive agent selling one brand.
Disclosure: Educational content only. Consult a licensed insurance professional.
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