Are you a senior looking for term life insurance information?
Well, you came to the right place.
In our Term Life Insurance For Seniors [The Ultimate Guide], we’ll show you the best rates, underwriting guidelines and everything else you need to know about purchasing term life insurance as a senior.
Topics Covered In This Article
- How Does Term Life Insurance For Seniors Work?
- Is There Any Cash Value In A Term Life Policy For A Senior?
- Answers To Some Important FAQs Seniors Need To Know When Purchasing Term Life Insurance
- Term Life Insurance Lengths For Seniors Available By Age:
- Term Life Insurance Rates For Seniors
- The Best Term Life Insurance Companies For Seniors
- No Medical Exam Term Life Insurance Options For Seniors
- Underwriting Term Life Insurance For Seniors
- Term Life Insurance For Seniors- 4 Case Studies
- What Are The Underwriting Requirements For Term Life Insurance For Seniors
- Best Term Life Insurance For Seniors Build Chart (Height & Weight Guidelines)
- How Much Term Life Insurance Do Seniors Qualify For?
- Are There Disadvantages Of Term Life Insurance For Seniors?
- Choosing The Right Company
- FAQ– Frequently Asked Questions
How Does Term Life Insurance For Seniors Work?
Term life insurance for seniors is pure life insurance coverage that guarantees payment of the stated death benefit to the insureds beneficiary if the insured dies during the designated term. Term life insurance is the most affordable and simplest way to protect your beneficiary(s).
Term life insurance lasts for specific period of time (the term) and pays a lump sum amount at the time of your death. The available term lengths are a: 10 year term, 15 year term, 20, year term 25 year term and 30 year term. The term lengths insurers can offer to seniors will depend on your age. For example, a 65 year old will not be able to take out a 30 year term life insurance policy but there are several insurers that will allow a 65 year old to take out a 25 year level (fixed) term. For more information on the longest, jump to the section: Term Life Insurance Lengths Available By Age For Seniors.
Is There Any Cash Value In A Term Life Policy For A Senior?
There is no cash value in a term life insurance policy, it is pure life insurance. You pay the premiums and if you die during the term your beneficiary receives the money. Also, with term life insurance you can cancel the policy at anytime without a penalty.
Term life insurance is similar to almost every other type of insurance such as auto, home or health insurance. You pay a monthly premium and if you need it, the insurance pays out the claim. When the policy is over, it’s over, the insurance company doesn’t give the money back if you don’t use it. Insurance is the one product that is great to have, but you hope that you never need to use it.
Answers To Some Important FAQs Seniors Need To Know When Purchasing Term Life Insurance
Here are several important key facts about a term life insurance policy for seniors you need to know.
- The rate premiums are fixed for the policy term (can’t increase regardless of age or health)
- The death benefit is fixed for the policy term
- Are able to cancel the policy at anytime without a penalty
- There is no cash value in term life insurance
- There is no waiting period, you are covered from day one for the full policy amount (with the two exclusions of suicide in the first two years or if you lie on your application and die in the first two years of the policy)
- Covers every type of death, natural causes and accidents (again just not suicide in the first two years or misrepresentation in the first two years)
- When the term expires, you can keep the policy but the rates typically go up exponentially and become unaffordable for most
- The death benefit is paid in a lump sum or an annuity income tax free, your beneficiary can choose when they file the claim
Term Life Insurance Lengths For Seniors Available By Age:
- The longest term length available for a 60 year old is 25 year term
- The longest term length available 65 year old is eligible for a 25 year term
- The longest term length available 70 year old is eligible for a 20 year term
- The longest term length available 75 year old is eligible for a 15 year term
- The longest term length available 80 year old is eligible for a 10 year term
Most life insurance companies give the option to pay your premiums either: monthly, quarterly, semi-annually or annually. When you pass away your beneficiary(s) receives the full death benefit directly from the insurance company, income-tax-free.
Seniors Typically Buy Term Life Insurance For The Following Reasons:
The reasons why a senior normally purchases a term life insurance policy are:
- Protect a spouse financially
- Have additional money available to supplement social security or a pension
- Replace income until retirement age
- Pay off debts such as a mortgage, credit cards, auto loan, student loans or medical bills
- Provide instant liquidity for beneficiary(s)
- Leave money for a child or grandchildren that rely on your financially
- Cover final expenses
- Cover estate taxes
- Pension maximization
- SBA Loan
- Key Person coverage
- Buy-Sell Agreement
Term Life Insurance Rates For Seniors
Ages 60-69 Senior Term Life Insurance Rates By Age Chart
Below are monthly rate quotes for seniors between the ages 60 to 69 years old at the preferred plus health class. The rates are broken down by male and female for coverage amounts of: $100k, $250k, $500k, $750k and $1 million. Your rates could differ based on your health.
**15 Year Term Rates***
|Female $100k||Male |
To calculate a specific term & coverage amount, anywhere from $50k up to $10 million and for different term lengths, 10, 15, 20, 25 years, for seniors over age 60 use the term life insurance calculator.
Ages 70-80 Senior Term Life Insurance Rates By Age Chart
Below are monthly rate quotes for seniors between the ages 70 to 80 years old at the preferred plus health class. Your rates could differ based on your health.
**10 Year Term Rates***
|Age||Male $100k||Female $100k||Male $250k||Female $250k|
To calculate a specific term and coverage amount, anywhere from $50,000 up to $10,000,000 and for different term lengths, 10, 15, 20 years for seniors over age 70 use the term life insurance calculator.
The Best Term Life Insurance Companies For Seniors
Below we will list many of the best term life insurance rates for seniors over age 65. Each company has their own underwriting guidelines so it’s important to choose the right company based on your health.
Below are the best term life insurance rates for a senior, a 65 year old female, in excellent health looking for $1 million 10 year level term policy:
Protective Life Insurance Company: $223.79 month
Pacific Life Insurance Company: $223.89 month
Principal National Life Insurance Company: $226.52 month
Penn Mutual Life Insurance Company: $226.52 month
Savings Bank Mutual Life Ins Co of MA (SBLI): $227.25 month
Ameritas Life Insurance Corp: $228.24 month
Lincoln National Life Insurance Company: $230.38 month
North American Co for Life and Health: $231.88 month
John Hancock Life Insurance Company USA: $237.10 month
MassMutual Life Insurance: $253.61 month
Prudential Life Insurance: $260.32 month
Guardian Life Insurance Company: $262.64 month
American General Life Insurance Company (AIG): $262.64 month
Banner Life Insurance Company: $264.55 month
United of Omaha Life Insurance Company: $267.68 month
Nationwide Life and Annuity Insurance Company: $276.94 month
New York Life Insurance Company: $325.41 month
State Farm Life Insurance: $450.69 month
Northwestern Mutual Life Insurance Company: $538.43 month
*See the rates from these carriers (except State Farm) using our quote engine on this site.
No Medical Exam Term Life Insurance Options For Seniors
Several large life insurance companies now offer seniors the possibility of purchasing a term life insurance policy without a medical exam, if you qualify. Generally it’s best to do the 30-minute no cost paramed, however it you don’t have the time or simply do not want to do the medical exam there are options available.
Let’s take a look at two top companies for no exam term life insurance for seniors and their qualifications.
Pacific Life Insurance Company
Pacific Life guarantees the applicant will not have the hassle of an insurance exam or lab work if they meet the stated qualification requirements below. Their accelerated underwriting program is called Smooth Sailing.
Qualifications & Requirements For No Medical Exam
- Applicants age nearest birthday 50-69
- Amount of coverage applied for and in force with Pacific Life must be less than or equal to $1 Million
- Comprehensive physical and blood work from the applicant’s personal physician within 18 months; up to two years of history may be requested at the underwriters discretion
Sagicor Life Insurance Company
Sagicor Life Insurance Company offers term life insurance for seniors for 10, 15 and 20 year terms. Sagicor’s Accelewriting is an automated underwriting system that utilizes an eApplication.
Accelewriting will provide an underwriting decision within minutes with no medical exams, bodily fluids, Attending Physician’sStatements (APS), or telephone interview required. In some cases, additional requirements may be requested. Policy eDelivery is available with Accelewriting.
Qualifications & Requirements For No Medical Exam
- 15 Year Term Non-Tobacco and Tobacco limited to age 70
- 20 Year Term Non-Tobacco limited to age 65
- 20 Year Term Tobacco limited to age 55
- All applicants must answer application health questions and undergo automated underwriting review. Depending on health answers, electronic report results, age, and amount of insurance applied for, an applicant may not receive an immediate decision, and a review of more information and/or a medical exam may be required to determine eligibility.
Underwriting Term Life Insurance For Seniors
The underwriting process is a big part of the equation when purchasing life insurance. If you are in excellent health, then choosing a life insurance company is straightforward and most people go with a highly rated insurer that has the lowest rate.
For those who have had some health concerns such as diabetes, sleep apnea, high blood pressure, high cholesterol, elevated liver enzymes, are concerned about the height/weight chart, cancer history, anxiety/depression, DVT, heart attack, stents, bypass or another health issue, then choosing the right company is paramount if you want to get approved and at the best rate.
Choosing the incorrect life insurance company for a specific health condition can cost you thousands of dollars in extra premiums that you would have not had to pay if you went with the right company the specializes in underwriting your particular health concern. Even worse, you could be declined by applying with the wrong company.
Term Life Insurance For Seniors– 4 Case Studies
Let’s take a look at a few case studies to show how underwriting affects term life insurance for seniors.
Case Study #1
A 62 year old male, diagnosed with type II diabetes in his early 50’s, is 6’00 220 lbs and is seeking a $500k 10 year term policy. His diabetes is well-controlled, takes metformin, his last A1c was 6.4 and he is also taking a blood pressure (hydrochlorothiazide) and cholesterol medication (a stain), also both well-controlled on the medications. His rate for $500k 10 year level term was $212 month. He was approved at the standard plus health class with Banner Life. This rate was significantly better than the other rates he received. Also, Banner Life is one of the best rated life insurance companies in the country and has been in business since 1836.
Case Study #2
A 65 year old female, 5’6” 204 lbs seeking $100k 15 year term. She is taking a blood pressure medication (lisinopril) with her last reading 140/85. Also, she is taking a cholesterol medication (pravastatin) and her last reading was 225 with and hdl ratio of 3.8. She was approved at Preferred Best health class with Pacific Life. $100k 15 year term was $83 month.
Case Study #3
A 70 year old male in excellent health, 5’11” 190 lbs seeking $250k 10 year term. The only medication he is taking is for high cholesterol (Lipitor), which is well-controlled on the medication. Last reading was 190 and hdl ratio was 3.5. He was diagnosed with mild sleep apnea 5 years ago and uses a CPAP nightly. His apnea index was 15. He was approved at the Preferred Best health class with AIG. His rate for $250k 10 year term policy was $181 month.
Case Study #4
A 60 year old male, 5’9” 210 lbs needed $1 million policy for a buy/sell agreement. He did have prostate cancer 3 years ago and had a total prostatectomy. His last PSA checkup from his doctor was negligible. He was approved at the standard plus health class with Banner Life. For a $1 million policy on a 10 year level term his premium was $3,583 annually.
Every life insurance company has their own underwriting guidelines and specialize in certain health conditions. That it’s important to shop different companies, especially if you have any health or underwriting concerns
What Are The Underwriting Requirements For Term Life Insurance For Seniors
Below is the sample underwriting requirement chart for a top life insurance company by age and coverage amount. Most of the companies are very straightforward, you do a 30-minute no cost paramed exam and it takes about 3-8 weeks for the final approval.
Best Term Life Insurance For Seniors Build Chart (Height & Weight Guidelines)
The two best carriers for seniors for height and weight are Prudential and Pacific Life. Prudential offers very generous build charts starting at age 60 and Pacific Life starting at age 65 and older. Often applicants are shocked that they qualify for such a good rate due to the favorable height and weight charts available to seniors from these two carriers.
Prudential Build Chart (Height & Weight Guidelines) For Term Life Insurance For Seniors Age 60 And Over (Male and Female)
Maximum weight to qualify for each health class is below.
|Height (ft)||Preferred Best||Preferred||Standard Plus||Standard|
Body Mass Index (BMI)
|Preferred Best||Preferred||Standard Plus||Standard|
Pacific Life Build Chart (Height & Weight Guidelines) For Term Life Insurance For Seniors Age 65 And Over (Male and Female)
|Height (ft)||Height (in)||Minimum Weight||Preferred Best|
Body Mass Index (BMI)
How Much Term Life Insurance Do Seniors Qualify For?
Below is a table called multiple of income guidelines from a major life insurance company. An insurers multiple of income table is the way life insurance companies determine how much total life insurance an individual can have in force. The reason why life insurance companies limit the amount of coverage one can have active on their life is that they don’t want someone to be worth more dead then alive.
Life insurance is to replace your income, cover debts or cover estate taxes.
Life insurance does cover suicide after two years, so insurance companies do have a limit on the total amount of coverage any individual can have on their life.
Each company is different but let’s take a look at a typical guideline one from top insurers below.
The multiple of income guideline is for the total amount life insurance coverage in force with all companies.
|21-40||30 x income|
|41-50||20 x income|
|51-60||15 x income|
|61-70||10 x income|
|70 and over||Individual Consideration (typically 5x income)|
For income replacement: life insurance companies go by gross annual income.
For estate planning and high-net worth applicants looking for liquidity the multiple of income guidelines can often be flexible (a good agent can speak to the underwriter on your behalf to get you approved for a large policy to cover estate taxes beyond the multiple of income table). Also, business life insurance such as debt repayment, Key Person, Buy-Sell (Business Continuation-Business Succession) have separate guidelines.
Are There Disadvantages Of Term Life Insurance For Seniors?
The disadvantage of term life insurance for seniors is the risk of outliving the term. Term life insurance is meant to protect your beneficiary(s) for a specified period of time; 10 years, 15 years, 20 year, 25 year, 30 years. Once the term is over, you can keep the policy but the rate typically goes up so much that most people will cancel the policy at that time.
Many seniors as well as younger applicants choose term life insurance because it allows you to get the most amount of life insurance protection at the lowest cost. Then at a certain time in the future, the need for the life insurance is reduced or eliminated.
For seniors that need a life insurance policy that is guaranteed to pay out and are in moderate to great health, many will choose a guarantee universal life insurance policy. This is a hybrid between term life insurance and whole life insurance. A guaranteed universal life policy costs more than term life since the coverage lasts a lifetime (but acts like a term life policy since the premiums and death benefit are fixed) but costs much less than a whole life since the policy does not build a cash value. This is the preferred policy for many for estate planning (high-net worth individuals) and also those needing final expense coverage of $25k and above. Again this policy is for those that are in average to excellent health.
Pro Tip: For seniors that qualify for a standard health class or better, a guarantee universal life insurance policy (GUL) is typically a much better deal than the rate on a typical whole life final expense policy from well-know companies such as: AARP, Colonial Penn, Lincoln Heritage, Gerber Life, Globe Life and the other popular advertised final expense companies.
Many seniors will compare rates for both term life and permanent coverage and choose the the best option for their beneficiary based on their needs, goals and also their budget.
If you are looking for permanent life insurance, see our article on:
Choosing The Right Company
One of the biggest concerns people have when purchasing a life insurance policy that the insurance company could go out of business and their beneficiary(s) will have an issue collecting the claim. The rule of thumb in life insurance is to purchase from a company that received and Excellent or Superior financial rating from A.M. Best.
By following this rule, you can have peace of mind the life insurance company is financially strong and will be able to pay out any future claims.
Here is a list of every life insurance company and their their financial ratings.
The truth is that the life insurance industry is one of the most highly regulated industries in the country. As long as you choose a company with an Excellent rating or better and pay your premiums on time, the policy will pay out.
In fact, all the companies we represent have never failed to pay a valid claim in the history of their company, most of the companies we represent have in business since the 1800s.
In addition, each state has their own state guaranty association. This is similar to the FDIC for banks as it is backstop in case a life insurance company becomes insolvent. Coverage is coordinated on a state-by-state basis, unlike the FDIC so policyholders should view their state’s association with any questions or concerns.
We hope our Term Life Insurance For Seniors [The Ultimate Guide] was able to provide you all the information you need to know to choose the best policy for you and your beneficiary(s).
FAQ– Frequently Asked Questions
What Does “Level” Mean When It Says “Level Term Life Insurance Policy”?
Level simply means everything is fixed, like a mortgage. The premium and death are fixed for the term and cannot increase regardless of age or health.
Is There A Prepayment Penalty On Term Life Insurance For Seniors?
No, you can cancel a term life insurance at any time without a penalty. You can just pay as you go, month-to-month, quarter-to-quarter, semi-annually or year-to-year.
Is There A Waiting Period On A Term Life Policy Insurance For Seniors?
No, a term policy covers all types of death, natural causes and accidents once your policy goes inforce (active). (For the two exclusions see the next FAQ below.)
Are There Any Exclusions On Term Life Insurance For Seniors?
There are only two exclusions on all term life insurance polices. Number one is you cannot commit suicide in the first two years of the policy for it to pay out and the death claim is contestable in the first two years if you die and lied on your application. Other than that, you are covered for the full policy amount once you are approved and make your first payment.
What Happens When The Term Expires On A Term Life Policy?
Most term life insurance policies allow you to keep the policy up to the age of 95, however, the rate becomes annual renewable at this point and the new rates are very expensive. Most people do not keep a term policy after the term expires due to the new price unless they developed a major health issue and can afford to pay the new premiums.
Is Term Life Insurance For Seniors Convertible To Whole Life Insurance?
Most life insurance companies allow the policyholder to convert their term policy to permanent coverage before the term expires or before they turn 70 years old, whichever comes first. Since seniors are closer to that age, for a new term policy many seniors do not convert their policy to permanent coverage sine it does have to be done so soon after the policy was taken out. Each company has their own conversion rules, so it’s important to ask the agent and check your policy on the conversion rules.
What Is The Oldest Age A Senior Is Eligible For Term Life Insurance?
80 years of age. An 80 year old is eligible for a 10 year level term policy.