Over Age 50? Top 5 Things to Consider for Term Life Insurance

Life Insurance

Term Life Insurance in my mind is all about replacing income and all that your income provides for. Your income, and if you have a spouse who has an income, perhaps young children, a mortgage, any debts or loans and everything else in your life style that you are accustomed to. When you are over age 50 and without life insurance or maybe you have an existing term life insurance policy that is coming up for renewal at a much higher rate than you have been paying you may be asking yourself what do I do now?

So here are 5 of the top things I think a person over the age of 50 should consider when looking to secure a term life insurance policy:

  1. What is your current situation? If you suddenly passed tomorrow, what do you have in place to take care of your financial needs? Do you have a mortgage? Do you have children who are still minors? Do you have children still in college? Take a snap shot of your current situation and ask yourself - do I have enough life insurance to cover my financial needs today?
  2. What Are Your Goals? Where do you see yourself in 5, 10, 15 or 20 years? If you have a mortgage, how many years from now do you plan to have the home paid off? Do you plan on staying in your home or are you planning to downsize and move to warmer climates or maybe a smaller living space? For any debts or loans, when is the projected timeframe to have those paid off?
  3. Is your term life insurance policy level? When shopping for term life insurance, the word level means the premium payment you are approved for will stay the same price for the term period you choose. This is a very important aspect of term life insurance. If you are age 55 and are considering a 20 year term life insurance policy, you want to have the peace of mind that your premium will not change during those 20 years. You don’t want to be surprised when 5 or 10 years from now, your payment suddenly increases. So make sure as you shop for term life to ask if the policy is a level term policy.
  4. Is your term life insurance policy convertible? This means you can convert your term life insurance policy into a whole life policy of equal or lesser value to the policy you have today. Keep in mind, whole life is much more expensive for less coverage because it is a permanent form of life insurance and does build cash value over time. So let’s say a person has a 20 year term life insurance policy and 10 years into it they determine they really don’t need the large term policy any longer. But they would like to have a smaller amount of coverage to stay with them. This way, when they pass away, they know there is a certain amount of money that will go to the beneficiaries and help pay for funeral and burial costs so that family doesn’t have to come up with money out of their own pockets. Always check with your insurance carrier on any specific guidelines about converting options.
  5. Are you working with a trusted company? Make sure you are comfortable with the life insurance company you are working with. Visit their website and read up on their values and mission statements. Look at their history and how long they have been in business. Check out how the company is rated, as there should be a section on their web site that shows ratings from companies such as A.M Best.

In my opinion, these are important aspects to consider when looking at term life insurance over the age of 50. 

About the author: Dan Cody has been in the life insurance business for over 7 years. He loves playing a variety of instruments including the guitar, bass, drums, and piano. He also supports cancer research foundations and volunteers at local pet shelters. Dan enjoys helping customers understand life insurance, so they can find a solid policy that fits their needs. You can reach Dan at 1-800-651-1953 or DCody@Pivot.com.