Simplified VS Guaranteed Issue Senior Life Insurance Policies
Article by Marilyn Katz
Did you know that a lot of seniors have not outlived their need for life insurance? There is good news because a lot of the major companies have developed products to meet this demand!
Older people have many different reasons for buying life policies today. Some simply want to be sure their family has enough cash to pay for a funeral. Because of the small face value, these are usually simple to qualify for. Sometimes they are called burial or final expense policies. When many people think about buying life insurance for the elderly, this is what they think of. Because the death benefit is fairly modest when compared to other types of life policies, the premiums are also kept fairly modest.
Others have much more complex reasons for buying a new policy at an older age. They may want to use their policy to transfer wealth, protect a business, or realize financial advantages while they are still alive. These may be larger and more expensive policies, but the potential applicants are convinced they will benefit. Whatever the reason, lots of older people are shopping for life insurance!
You may remember going through a complex underwriting process when you purchased a policy. In order to get the very best rates, younger and healthier people may find that they can save a lot of money by submitting to a long health application. A medical exam may be called for. However, many older applicants will have developed some health issues Even if these health issues are under good control, and the person can still expect to live a long time, they may not ever qualify for the cheapest rates.
Insurers know this. So they have come up with simplified and guaranteed life insurance for seniors. Policies like this will accept many older applicants, and they will not require them to go through a long application process. These two types of policies are similar, but have some very important differences you should understand.
A guaranteed issue policy does not have to ask any health questions at all. You have probaby seen ads for senior life policies on TV. Products like this are marketed to people who are over age fifty. The maximum age varies, but may go up to age 80 or age 85. Instead of using health questions or a medical exam, the insurance company will impose a waiting period before the full benefits will be paid. For some older people who cannot qualify for a normal policy because of health problems, this can be a good deal.
However, a lot of older people are fairly healthy. They can choose to apply for a simplified issue policy instead. They will only have to answer a few heath questions, and will not usually havve to have a medical exam. The policy will not have a waiting period. Premiums are also usually cheaper.
Middle aged people, and even senior citizens, can still qualify for many types of life insurance policies. It is important to understand how these policies work so you can find the one that will benefit you for an affordable price.
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