Life Insurance for Australian SeniorsApril 18th, 2013 | Posted by in Articles
The twilight years can be the most exciting and rewarding of your life, and the last thing you want to deal with is the worry of becoming a financial burden to your family and loved ones in your later years and beyond, so life insurance is important to consider. You’ve spent your whole life paving the way for a comfortable retirement, but if tragedy occurs, then at least secure life insurance cover can help relieve some of the stress.
Everyone’s circumstances are different. You may be in a position where your living arrangements and financial situation leaves you independent and comfortable. But most people require some level of life insurance cover to help with legal or medical costs, paying off a mortgage, or creating a bequest for your children and grandchildren or even funeral costs.
As a senior citizen, your life insurance needs are vastly different to those of someone, for example starting a family. Life insurance providers have specifically constructed policies to cater for older people. In Australia, the maximum age you can apply for life insurance is 75 years on your next birthday. In general, if you’re over the age of 50, when you go to buy life insurance as a senior, you’ll find it can be much more expensive than for those who are younger. The obvious factor that affects your premium is age, but there are a number of other conditions that can factor into the cost:
• Gender (men will usually pay more, as they have a lower life expectancy)
• Current health
• Smoking status
• Blood pressure and cholesterol levels
• History of family illness
• Weight and height
• Pre-existing medical conditions like heart disease, or type 1 or 2 diabetes
Although these factors can determine the premiums you’ll pay, it doesn’t mean you won’t be adequately insured. In Australia, there are four major types of life insurance for seniors:
• SINGLE–PREMIUM LIFE INSURANCE: If you are in the position of having a comfortable disposable income, this type of life insurance might suit. Instead of paying monthly or even annual premiums, one lump sum is paid upfront. Insurers may even offer discounts on this type of premium, as there is no risk of non-renewal, plus benefits from the interest when investing your lump sum premium. Buying insurance this way can also be of great tax benefit.
• GUARANTEED ACCEPTANCE: This type of life insurance, as the name suggests can be taken out by any senior without having to undergo a medical examination. However, in most cases, benefits will be withheld for a period of time (usually 1-2 years) unless death is accidental. If you choose to undergo a medical exam, your premiums may be much lower.
TERM LIFE INSURANCE: This is the simplest form of life insurance requiring the payment of monthly or annual premiums which increase as you get older. It will payout an agreed lump sum of money if you die or develop a terminal illness
INSURANCE FUNERAL COVER: This type of insurance pays out an agreed lump sum to cover your funeral costs and is renewed each year
Make sure your policy covers things you may need later, like alterations to your home in the even you’ll need ramps installed, or in-home care as well as ongoing medical requirements.
There are many comparison websites which explain the different types of policies available, and offer suggestions as to how much cover you will need. When taking out seniors life insurance, the advice is to spend a little time spent researching.This material is not intended to constitute personal advice, and must not be relied on as such. This information has been prepared without taking into account your objectives, financial circumstances or needs. Before making a decision based on this material, you should consider the appropriateness of this material having regard to your own objectives financial circumstances and needs. You should consider obtaining independent advice before making any decision.
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