In adulthood, everyone of us is at a different stage, especially around your 60s. Some may be thinking of retiring their full-time occupation in the near future, whereas some may have retired years ago.
Your financial circumstances may also not be the same. It is most common that in your 60s you have fewer financial commitments than in earlier life (for example no longer paying for childcare or providing for a young family), so when considering a life insurance policy, you may need less cover.
According to simplybusiness.co.uk, on average in the UK, men retire at 65 years old, while women tend to leave work at an average of 64 years old.
This indicates that in your ‘mid sixties’ you are more likely to be settled, perhaps with a pension and no longer feeling the need to work to keep your household financially stable.
Instead, you may be more focused on planning for later life – such as helping to cover high funeral costs or leaving your loved ones a cash gift.
In this article, award winning life insurance broker, Reassured, discusses the policy types best suited for those over the age of 60.
Life insurance policies for over 60s
Over 50 life insurance
An over 50s policy (sometimes referred to as a guaranteed over 50 plan) is a suitable and affordable option if you want to be covered for the rest of your life.
Here are some key points to know:
- You will have guaranteed acceptance if you’re a UK resident aged 50 – 85
- No medical information is required, so you won’t pay more for cover due to your health
- Your loved ones are provided with a cash lump sum pay out after your passing
- You’ll have full cover after the waiting period (the first 12 or 24 months of the policy) although a refund of premiums will be issued if you pass away from natural causes during this time
- Immediate accidental death cover during the waiting period
- The maximum sum assured is lower than other types of cover (often capped at £20,000)
An over 50s plan could be ideal for those who have struggled to secure cover due to poor health, or those in their 60s who have minimal financial commitments and only need to provide a small amount for their loved ones.
However, if you’re in good health and have no high-risk factors (for example you’re a non-smoker, have no previous or current medical conditions or high-risk hobbies) then you may be able to secure a higher level of cover with a whole of life policy.
Whole of life insurance
Whole of life insurance is another option that is guaranteed to cover you for the rest of your life. With this policy, you will be asked for more information during application compared to an over 50s plan, so the premium cost may fluctuate depending on your personal circumstances.
Meaning this may be a better option for those in their 60s with no high-risk factors.
Both over 50 plans and whole of life cover are actually forms of life assurance, as a pay out is assured as long as you keep up with monthly premium payments.
A whole of life insurance summary:
- The maximum sum assured is likely to be higher than that of an over 50s plan
- Requires your medical information, unlike an over 50s plan, and acceptance is not always guaranteed
- Provides a guaranteed lump sum cash pay out
- You’ll need to continue paying premiums until you pass away (or until a certain age depending on the insurer).
Your medical history may affect the cost of your premiums, so if you have suffered or are suffering with a health condition (perhaps even family history of a condition) then this may not be the most affordable option available.
Term life insurance
If you are looking to cover your remaining mortgage balance or any other debts, term life insurance could be a great option for you as the term can end when the mortgage is paid off/when debts are paid.
Below are the main points to know about term life insurance:
- The policy protects you for a specified length of time (the term) so you don’t have to worry about leaving financial debts to loved ones after your passing
- There are level or decreasing term policy options (level remains fixed over the policy term and decreasing reduces over the policy term)
- Requires your medical information (as previously mentioned, this can affect the cost of your premiums)
- It provides a cash lump sum pay out if you pass away during the term
- Free terminal illness cover included with all term life insurance policies
This is a popular option for those in their 60s who have a mortgage as there are options for both an interest-only mortgage (level term) and repayment mortgage (decreasing term). However, if you were planning on leaving an inheritance or covering inheritance tax on your estate, this may not be the best option for you as a pay out isn’t guaranteed.
Please note, as with all life insurance, the older you are the higher your premiums will be as you pose a greater risk to the insurer. So, whilst you can secure term-based cover in your 60s it will be significantly more than if you were in early adulthood.
Ultimately, the option best suited to you will be down to your own personal circumstances and what you’re looking to protect.
Where can I get life insurance over 60?
There are many ways to go about securing yourself a life insurance policy. We recommend comparing multiple quotes before making your choose as prices can vary wildly. By comparing quotes, you can explore all the options available from different insurers and find an affordable price.
Reassured are an award-winning broker who offer a free service to compare life insurance quotes, helping you save time and money.
Another good option is to use a reputable comparison website. Whichever method you use make sure to compare the market to secure your loved ones’ financial future, then get on with living life to its fullest.
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