A Guide to Buying Life Insurance for Seniors

Consider your financial goals, age and overall health to determine which life insurance option is right for you.
Georgia RoseJun 29, 2021

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Seniors may have a tough time finding the ideal life insurance policy, but worthwhile coverage options do exist — whether you want to cover final expenses or leave a lump sum for your family.

While it’s true that life insurance policies become more costly as you age, many insurers will accommodate older adults, even if you’re not in perfect health. Here’s what you need to know about shopping for life insurance as a senior.

Before you start shopping, check whether you need life insurance. If you’re debt-free and have healthy savings or funds set aside for final expenses, then you might not need coverage after all. A life insurance policy might make sense if you:

  • Have outstanding debt that others would have to repay.

  • Support a spouse, child or other dependents with your income.

  • Want to cover your own funeral and burial costs.

  • Have a high net worth and want to cover estate taxes.

  • Want to provide an inheritance to those you leave behind.

Types of life insurance for seniors

Term life: Cheapest option

A term life insurance policy could be a good, low-cost option if you’re in great health for your age and willing to take a medical exam. Because term life is temporary, it’s most suitable for covering debts, such as a mortgage, or providing financial support for a spouse or dependent should you die during the policy term.

If you shop for life insurance in your 60s and 70s, you can typically secure a 10- or 20-year term life policy, but if you’re over 80, you’ll likely have difficulty finding term life coverage.

Whole life: Lifelong coverage

Whole life insurance can provide long-term peace of mind because the death benefit will pay out regardless of when you die, as long as you pay the premiums. Similar to other permanent policies, whole life builds cash value by investing a portion of your premiums into a savings account. You can then withdraw the cash, or take out a loan against the value. However, it can take time for the cash value in life insurance to build — sometimes a decade or more.

This type of life insurance is typically more expensive than term products, especially if you purchase a policy later in life. This is because your health can decline as you age and your life expectancy is shorter, which means the insurer might have to pay out the policy sooner.

Guaranteed issue life insurance: No medical exam

Sometimes called senior life insurance or “final expense” insurance, guaranteed issue life insurance has no medical requirements for acceptance. Life insurance companies use medical exams to better understand your health and predict life expectancy, so policies that require them tend to be cheaper. However, if your health precludes you from qualifying for coverage, no-medical-exam life insurance such as simplified or guaranteed issue may be a worthwhile option.

These policies typically come with a two-year waiting period before full benefits are available, referred to as a graded death benefit or limited benefit period. Unless you die from accidental causes, your beneficiaries may not receive the full amount of death benefits from your policy during this two-year time frame. Instead, the insurer will either reimburse them for the premiums you paid plus interest, or pay out a smaller amount. Life insurance medical exams are typically free, so they may be worth it even if you’re not in perfect health.

Alternatively, simplified issue life insurance skips the medical exam and instead requires you to fill out a health questionnaire. Coverage tends to be low, rarely going above $100,000.

Funeral insurance: Burial coverage

Another option for seniors is funeral insurance, which is also called pre-need insurance. These plans are typically purchased from funeral homes, and the payout goes directly to the funeral home to cover the cost of prearranged services.

Funeral insurance is different from burial insurance, which pays the death benefit to life insurance beneficiaries of your choosing who can then use the money for any purpose.

Guaranteed universal life insurance: Term and perm combination

Guaranteed universal whole life insurance is a blend of term and permanent life insurance. Guaranteed universal, sometimes called “term for life,” is similar to term coverage in that the policies expire after a certain amount of time. However, instead of choosing a number of years to cover, you select an age at which the policy will expire, such as 90, 110 or 121.

Guaranteed universal life has lower monthly premiums than whole life, but it still typically offers a small cash value while providing high coverage amounts. Guaranteed universal policies typically require you to pass a medical exam to qualify, and coverage is not assured. The word “guaranteed” refers to a guaranteed death benefit, as long as you pay your premiums.

Cost of life insurance for seniors

Finding cheap life insurance for seniors is not always easy, as the cost of coverage typically increases as you age. But affordable options may be available, especially if you’re in good health. Here’s the average cost of life insurance for older adults, including seniors over 80:

Average monthly life insurance rates for senior women

Policy type

65-year-old woman 

75-year-old woman 

85-year-old woman

10-year term life ($100,000)

$66

$191

n/a

Whole life ($100,000)

$349

$623

$1,345

Guaranteed universal life ($100,000)

$254

$471

$1,162

Simplified issue whole life ($10,000)

$47

$82

$153

Guaranteed issue whole life ($10,000)

$66

$114

$221

Source: Quotacy. Average rates are from three top carriers, for healthy applicants.

Average monthly life insurance rates for senior men

Policy type

65-year-old man 

75-year-old man

85-year-old man

10-year term life ($100,000)

$89

$269

n/a

Whole life ($100,000)

$414

$712

$1,579

Guaranteed universal life ($100,000)

$294

$545

$1,398

Simplified issue whole life ($10,000)

$62

$113

$228

Guaranteed issue whole life ($10,000)

$88

$150

$233

Source: Quotacy. Average rates are from three top carriers, for healthy applicants.

How to shop for senior life insurance

When deciding what type of life insurance to buy, first consider your financial goals and how much cash you’ll need to accomplish them. For example, a term life policy could cover mortgage payments or other outstanding debts that would become the responsibility of others when you die. If your goal is to pay for funeral expenses, you might consider a small whole life policy or pre-need insurance, as the death benefit pays out regardless of when you die. Or maybe you want to leave a sizable inheritance to your loved ones with a guaranteed universal life policy.

Before buying a policy:

  1. Shop around. Compare monthly premiums and death benefits to ensure you’re getting the right policy for your budget and financial goals.

  2. Work with a fee-only financial advisor to make sure you choose a policy that fits your situation, especially if you plan to purchase life insurance with an investment component.

  3. Read the fine print carefully. Make note of important details, such as which causes of death aren't covered and what will happen if you can’t pay premiums.

Determine if you need a rider

Life insurance riders are features that can be added to a policy, sometimes for an extra cost. Riders vary by company and policy, but include:

  • Accelerated death benefit, where you can access part or all of the death benefit early if you’re diagnosed with certain health conditions and need medical care or nursing home care.

  • Long-term care riders, which help cover the cost of an in-home care provider or nursing home.

  • Child riders, which provide death benefits for young children of the policyholder, should they die during the policy period.

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