How old is too old for life insurance?


Jul 7, 2016
How old is too old for life insurance?

Now there’s a question! In fact, you are never too old - or too young - to think about your life insurance needs. That is why different types of policies exist, from mortgage life insurance cover to over 50s life insurance, to protect you and your family through your different life stages.    

Starting out … mortgage decreasing term life insurance   

You have got your first step on the property ladder and setting up home, so keeping the roof over your partner’s head if you die may be a key concern.   

This is where mortgage decreasing term life insurance can help. It pays out a cash sum if you die within a specified number of years, with the amount paid out decreasing over time in line with your outstanding mortgage balance.

   

Having children … critical illness cover and term / whole of life insurance   

As a young couple starting out, you may want to keep your outgoings low and so only opt for the protection of decreasing mortgage cover. Once you have children, however, you may want to consider additional protection in the form of critical illness insurance.   

Critical illness pays out a lump sum amount in the event that you are diagnosed with a serious illness – meaning that you can concentrate on getting better and not worry about the financial implications of you being unable to work.     

Still not convinced you need it? A recent article highlighted how, if your partner became too ill to work, you could have to wait up 39 weeks for state help – would you have enough savings to pay your mortgage and other outgoings in that situation? 

   

Term life insurance / whole of life cover   

While none of us like to think of our mortality, sadly the unexpected does happen as this very sad story about a young mother who was knocked down by a car shows.   

That is why as a parent, you may also want to consider making some kind of financial provision for your children should one or both parents die, in the form of term life insurance or whole of life cover.   

Term life insurance pays out a cash sum if you die within a specified number of years, so you may want the policy term to run until your children reach the age of 18, for example.    

Whole of life insurance pays out a cash sum when you die, no matter when that is. Because it does what it says on the tin – covers you for the whole of your life - the premiums are typically more expensive than those for a term life insurance policy.   

Over 50 life cover   

Once you are in your 50’s, typically the children will be grown up and you will have cleared - or at least reduced - the balance on any mortgage you have, hopefully leaving you a tad more financially comfortable.    

That doesn’t mean, however, that you don’t need life insurance. As we highlighted back in March, in the last five years, 27% of Brits (1.2m) have turned to payday loans in order to bury a loved one, racking up a total of £576 million debt.   

Unless you have sufficient savings to be used towards your funeral costs, would you really want your partner or children to fall in to debt in order to send you off?    

That is why over 50 life insurance exists, by providing those you leave behind with a cash sum that can be used however they wish – for example, to pay for your funeral or to clear any small debts.  

Over 50s life insurance pays out a cash sum when you die and is suitable for anyone aged 50 to 80 years old. No medical is needed in order to apply and you have guaranteed acceptance. This means that if you even if you have been refused life insurance elsewhere (perhaps due to a pre-existing medical condition), you can still get life cover for the over 50s. 

You are never too old! 

While the younger you are when you buy life insurance, the cheaper it may typically be, the good news is that there are a number of affordable life insurance options to protect you and your loved ones throughout the various life stages.   


Ashley Shepherd is an Over 50s Personal Finance Expert

ashley shepherd

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