You may think that saving money on life insurance is not possible over 50 years of age. But there are several steps you can take to ensure that you can qualify for the best possible rates for your age and health.
We are going to look at 8 of the easiest and most effective ways of reducing the cost of what you will have to pay for life insurance. Some of the information here you may already know, and some of it may surprise you.
Either way, these are important steps for anyone to consider before shopping for life insurance policies.
1. Apply for life insurance today
You have probably heard that old Chinese proverb that goes: “The best time to plant a tree was twenty years ago. The second best time is right now.”
That wisdom rings true for many things, and life insurance is one of them. After all, you are not going to get any younger. And the fact is – all else being equal – that the younger you are the cheaper your life insurance will probably be.
Even for applicants over the age of 50, it is possible to qualify for high-quality life insurance policies at affordable rates. But continuing to put off the application process for another day only exposes you to the potential for higher premiums – not only from advanced age but also from unforeseen health concerns.
2. Choose the right kind of life insurance policy
There are many kinds of life insurance policies available, and sorting through your choices can be more than a little daunting. The most popular types of life insurance are:
- Whole life insurance
- Universal life insurance
- Term life insurance
Knowing which is the right fit for you and your family’s needs will go a long way towards ensuring that your premiums are well invested.
Whole life insurance is precisely what it sounds like. You purchase a policy that covers you over the course of your entire life. Premiums remain the same throughout from the first day to the last, regardless how old you might live to be or any health issues that might arise along the way.
Another advantage of whole life is that the cash value of the policy grows tax-deferred. On the other hand, because it takes time for the cash value of a whole life policy to grow, it may not be the best choice for every individual over 50 years of age.
At first glance, universal life insurance appears similar to whole life. But the key difference in many plans is that the policy can be structured as a low cost way to provide lifetime coverage.
With a guaranteed universal life policy this is coverage that can be structured to last for your entire life with a guarantee that as long as pay your premium the policy stays in force. Very little if any cash value is built in these types of plans. These are really designed just as a way to provide low cost lifetime coverage.
Again, whether or not a universal life insurance policy is the right plan for someone over age 50 will depend on his or her unique situation.
Finally, term life insurance is perhaps the most straightforward kind of plan available. About 9 times out of 10 we will recommend term life as the most appropriate coverage to buy.
Term life pays a death benefit only and does not build any cash value. Instead, you are covered for a given number of years, which is usually 10, 15, 20, or 30 years, though other options are available. And with most policies, your premiums will remain the same throughout the period of coverage.
Many people over 50 years of age find term life more ideal. Usually, this is because many at this age are still working, and the policy provides security to loved ones in the event of death.
A 20-year term life insurance policy, for example, might give older policyholders the time they need to pay off mortgages, continue investing for retirement, or delay Social Security benefits.
Whatever your situation may be, we highly recommend you speak with a qualified independent life insurance agent before choosing a policy.
3. Buy a larger life insurance policy
This may seem counterintuitive at first, but life insurance, like most things, is usually a better value when purchased in bulk. We are, of course, talking about the death benefit of the policy. Typically, the cost per $1,000 in coverage goes down as the amount of coverage purchased goes up.
Now, we are not suggesting that you purchase more life insurance than you need. That would not make a lot of fiscal sense. But getting the full amount of coverage you do need will likely prove a better value.
A good life insurance agent can help you evaluate your life insurance needs and decide on the right policy at the best rates.
4. Opt for the medical exam
You have probably heard of policies called “guaranteed issue” or that require no medical exam. Depending on your situation, these can be great options. For example, an applicant with health concerns might find they only qualify for a guaranteed issue life insurance policy.
In most cases, however, choosing a policy that requires a medical exam could save you a lot of money in premiums. This is sometimes true even for people over the age of 50 with minor medical conditions. And for healthy applicants, it is almost always advisable to choose the medical exam.
It is always best, though, to discuss your situation with a qualified life insurance agent before making such decisions.
5. Pay your premiums annually
Many life insurance companies allow you to make premium payments yearly instead of monthly. Not only is this more convenient, but in most cases paying annually does provide a discount.
Ask usif this is an option. And you might ask, too, if there are discounts for automated premium payments directly from your banking account.
6. Get into shape
You do not need to be an Olympic athlete to get the cheapest life insurance premiums possible. But getting any health concerns under control could very well help you qualify for more affordable premiums.
For example, exercising regularly can have an enormous impact on your overall health, positively affecting many issues that could be a concern for underwriters. Of course, you will want to check with a physician before beginning any kind of exercise routine.
Or, if you do have some health concerns, you could always do the following after purchasing a life insurance policy…
7. Request a reevaluation
You might believe that your life insurance premiums cannot change for the better after having purchased a policy. That is not necessarily the case. If your health has improved, you may want to ask your insurance company about a reevaluation.
A few changes your life insurance company might consider are:
- Lower blood pressure
- Lower cholesterol levels
- Losing and keeping off weight
- Stopping tobacco use
This isn’t a complete list, but these are some of the more common improvements you can make to your health that might qualify you for a reevaluation of your premiums.
Many insurers will require that a certain period of time has passed before allowing a reevaluation, usually 1 year. For smokers, most life insurance companies will require a longer period of time to have passed since quitting before a reevaluation is available.
8. Shop for the best premiums
This should really go without saying. But many people over the age of 50 continue to purchase life insurance policies without having ever shopped around for the most affordable coverage. This might be because they found it convenient to buy a policy from the same company who provides their home insurance. Or perhaps they were referred to a particular company by a friend.
Not all life insurance plans are created equally.
What many people do not realize is that comparing rates between insurance companies is easier than ever. Yes, thanks to the internet, shopping for the best coverage can be done in minutes, not hours or days. In fact, independent agents like us work with dozens of companies and are able to quickly check rates from a wide range of insurance companies..
Shopping for life insurance with a qualified independent agent is the quickest and easiest means of saving money on your life insurance and understanding all your options.
And speaking of options, we have certainly thrown a lot of them out there in this article. Don’t feel overwhelmed. You can give us a call at 714-916-9723.
We would love to help you navigate your search for the perfect over 50 life insurance policy.