Life insurance is important part of financial planning, and can be even more so as you get older. Even if you no longer have financial dependents, you may want to leave something behind and more and more people are assisting relatives with funeral costs. If you’re thinking of taking out cover for the first time when you’re over 50, it’s important to make sure that you take out life insurance for over 50s that will work best for you and your circumstances.
When taking out life insurance over 50, many people automatically choose specialised life cover for people in their age range, which often omits the requirement for a medical examination or questionnaire. There has been some negative press about these plans, but they can be a useful option depending on your circumstances.
For example, if you’re in your 70s or have poor health they may be a good option for you and some plans will even allow you to sign up until you’re 85. For people in these situations, when taking out life insurance over 50, no medical examination could mean the difference between getting some form of cover or not being accepted for a life plan at all. Above all, it’s important to make sure that you’re making an informed decision about which plan is best for you, whether that’s life insurance for over 50s with no medical, or a level term life insurance policy.
Over 50 Life Cover – No Medical
The major advantage of specialised over 50 life insurance is that along with having no medical questionnaire, you’re also guaranteed to be accepted into the plan regardless of your age or health. This might suit you if you’re older, have an existing medical condition, or are uncomfortable filling out health questionnaires or attending medical examinations. This is the main reason why many people opt for over 50 life cover: ‘no medical’ is an attractive option to those who feel they would not qualify for life insurance otherwise.
Many people have claimed that these life insurance policies are a scam, or are bad value for money. The reality is that this depends on your personal circumstances and you should assess how likely it is that this insurance will pay out enough when you die to make it worthwhile. You may pay in more in premiums than the plan pays out after your death, especially if you take out the plan early in your 50s and live for a lot longer than you expected. However if you take the policy out later in life or die sooner, then you’re likely to get a better return on your policy. Make sure you’re aware of this when you sign up for the plan and that your premiums are a reasonable financial commitment.
Life Insurance over 50 – with Medical
Opting for specialised over 50 life insurance may not be the best option for you if you’re in your early 50s, in good health, or don’t mind paying higher monthly premiums for a higher payout. Research your options and don’t rule out term life insurance, or underwritten life insurance for over 50, which may give you better value for money depending on your circumstances.
Remember, there is generally a 5 year minimum term for paying your premiums before your family will receive any payout with standard life insurance. With the over 50s life cover “no medical” option, this period is normally two years. There’s also often a maximum policy term of 40 years, meaning that if you do live longer, you may not be covered.
With both options, it’s important that you make a decision based on your own personal circumstances, age, and financial situation.
Still unsure whether you’d like to take out life insurance for over 50s with no medical, or if an underwritten over 50s life plan might be the best option? Read GrownUpMoney’s guide to over 50 life insurance, where you’ll find more information on which policy may be most suited to you.
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