Over 50's Term Life Insurance Cover
If you have reached aged 50 plus in 2018 - you may find your life insurance needs are different than previously. The children may have left the nest, the mortgage just repaid & retirement is on the horizon or indeed you are already retired. In this article we will run through some of your generic options in the Over 50 plus life insurance marketplace.
Over 50's term life insurance is usually a simple and cheap type of over 50 Life Cover. It is known as term assurance because you may choose the term ie; how long you're covered for - usually say 25 or 30 years (the term) up to say age 85-90 for many Uk Insurers.
Note: However, that Over 50+ Term life assurance only pays out if you die within the term you've agreed. If you live longer than that term, your dependants may get nothing ! As a couple, you can also take out joint over 50s Life Insurance term cover, with the policy proceeds paying out on 1'st death ie; if first one to die during that term.
Term Over 50 Lifecover plans are medically underwritten, which means that if you do have major medical issues, then the premiums maybe medically rated; If this a problem, then no medical Over 50's lifecover maybe a better option.
Increasing over 50 s year old lifecover policy (where cover and premium rise over the years)
2 single over 50's life insurance cover plans or a joint over 50 s life assurance cover policy
Renewable over 50 Plus + life insurance cover plan (which let you extend the original term).
Convertible life insurance cover plan (which let you convert to whole life cover policy but usually before say age 55).
Guaranteed (where life insurance premiums stay the same throughout the term)
Reviewable premiums (where life cover premiums may go up every year or 5 years gone up at a review)
Waiver of Premium (where the Insurer waives/protects & covers your premiums after a deferred period of say 4/8/13/26 weeks due to sickness or accident but usually only to age 65)
Consider how much lifecover you need - if this is not covering say just funeral insurance costs but debts like a mortgage or loans still.
Same typical issues apply re insurance for over 50 - over 55 year old life insurance cover; over 60 life insurance cover; over 65 year life insurance cover; over 70 life insurance cover; over 75 year old life insurance cover; over 80 year old life insurance cover;
Aged 50's Plus - No Medical Life Insurance Cover
This type of policy is designed ideally for those Over 50's people with major medical health issues.
Typical Key Features of a No Medical Over 50 Plus Life Insurance Cover
A Whole of Life plans with no medical questions asked
Generally insurers restrict premiums upto £100pm maximum per their plan
Initial Exclusion claim periods of 1/2 years mean usually no claims paid in that time frame from natural causes
- Some payout additional sum if you die as a result of an accident during this timeframe
May refund premiums plus - during their exclusion periods
Some Insurers may stop their premiums after 20 years payment, or at say age 90.
Plans generally tend to be level lifecover rather than index linked
Some plans include serious critical illness after initial 2 years
Plans may now include terminal illness payout if advised only 12 months to live
Insurers now may also include a funeral payout option linked to say Coop Funeralcare or Dignity
Over 50 - Whole Life Insurance Cover
Aged 50 plus Whole Life Insurance but with full medical underwriting. A protection cover plan that via definition as the name implies, is insurance guaranteed for the whole of your life, whenever you die. Whole Life Cover is traditionally more popular with those looking for over 50's life cover than necessarly term insurance, which as mentioned only pays out if you die during the policy term. You may find if this plan was intended as a funeral insurance policy, it better to take out 2 separate life policies instead.
- Designed to pay out on death - whenever it occurs
- Benefits are currently paid out tax free on claim
- Whole Life Assurance Cover may be level or inflation linked
- Medical evidence may be required and a medical examination for those with health issues
- Premiums may be guaranteed or if investment based reviewable
- Maybe payable on death or earlier Terminal Illness
- Benefits can be set up to be payable into Trust
- Can be set up on sole or joint life basis
Whole Life insurance over 50's lifecover policies are designed to always pays out upon your death so logically are more expensive than over 50's term life insurance plan as the risk is greater to the Insurers. Whole of Life insurance is more expensive because it is certain that the life company will eventually have to pay the life sum insured.
2 types of Whole Life Assurance cover plans exist: Investment based versus Guaranteed premiums
Over 50's Life Assurance - Investment Based Premiums
Your whole of life premiums are invested into a fund to cover the cost of whole life insurance rates. Potentially if surrendered this plan may aquire a value.
This type of cover aims to balance the level of life cover with adequate investment to support the protection in later years and thus try maintain the original premium throughout life. This relies on the value of units invested in the underlying fund growing at a certain level each year. Poor fund performance or Increased fund charges could result in the premiums being inadequate and may have to be increased to maintain the same level of cover at review.
The initial premiums and the sum insured are designed not to increase for the first 10 years. After this initial period the plan is reviewed and if necessary the whole life plan premiums may be increased.
Note: We do not give advice or do investment based whole life insurance online quotes. We can refer you to an authorised adviser if you need help with this type of whole life products.
Over 50 Plus Life Insurance - Non-Investment Based ~ Guaranteed Premiums
This type of whole of life insurance policy, as the name implies, has guaranteed premiums that are not investment based; they are generally none-reviewable premiums. These premium therefore stay the same throughout the plan but unlike the investment based cover above, have no surrender value. It can be set up on a single or joint life basis. The cover can be level or also index linked.
Most guaranteed over 50 plans will not allow more than say £50-£75pm premium - which will limit cover offered given age anyway.
Whole of Life Assurance - Uk premiums will depend on the following: sum to be insured, your age, your health and whether you smoke or not. A non smoker is usually defined as someone who has not smoked for at least 12 months or taken nictotine replacement products. Premiums for women were generally lower as on average they tended to live longer but from 12/2012 the new gender rules applied.
Check the quotes & Key Facts documents for your over 50 whole life quotation produced.
Trusts: Should my Over 50's Life Cover policy be set up in a trust?
Trusts can help avoid delays in money going to dependents but should not displace the importance of making a will. However, it can potentially avoid the risk of having to pay inheritance tax [whose rules change with each successive government]. The terms and conditions of Whole of Life Insurance policies trusts vary, so make sure you understand the scope of the trust being offered before committing yourself & seeking independant legal advice if necessary.
Do you want Advice in 2018 on over 50's Life Insurance Cover ?
After looking through this article if you would like advice on over 50's Life Insurance, complete our life assurance quotation enquiry form, get a quote & we will contact you to discuss your life insurance and protection needs.