Being over 85 can present various challenges trying to get life insurance. Learn what to expect when looking for life insurance quotes for seniors over 85.
For the most part, the best time to get life insurance is when you’re young and healthy. That way, you can ace the medical exam, and you don’t have to pay as much in premiums. However, just because buying life insurance at a younger age is a smart move doesn’t mean that you can’t get coverage when you’re older.
In this article, we’re going to discuss the possibility of obtaining life insurance quotes for seniors over 85. Yes, you can get covered at that age, so don’t assume that you’ll be denied. That being said, your options are much more limited, so it’s crucial to know what to expect beforehand. Let’s dive in.
Why Do You Need Life Insurance?
Buying a policy at an advanced age can be a challenge, so you need to have a compelling reason to go through the process. Also, many people don’t have the same needs at 85 that they do at younger ages.
For example, when getting coverage at 30 or 40, one of the primary reasons may be to support a spouse and/or children. In many cases, the loss of a loved one can bring substantial financial burdens, which is why life insurance can offer such peace of mind.
At 85, however, chances are that your kids are grown, and you may outlive your spouse. Not only that, but your financial situation will likely be much different at that age than it was when you were younger. You’ve already retired, and your average expenses will typically be less than they were before.
Still, there are some compelling reasons to get life insurance for seniors over 85. Let’s break down the most common ones.
Unfortunately, dying in the US can be an expensive proposition. Burials can cost tens of thousands of dollars, depending on what you want and how you want to be remembered. Everything from the coffin (or cremation) to the memorial service will be pricey, so your loved ones need to be prepared.
On average, the price of a funeral can be around $6,500. However, this total depends significantly on where you live and which options you select. Here’s a quick overview of some of the final expenses that your loved ones will have to handle.
- Basic Services Fee – this fee will cover much of the overhead associated with a funeral and burial. Typically, this will be your highest cost, so you’ll want to shop around and compare prices. Also, it’s often a flat rate rather than an hourly expense.
- Embalming – if you want an open casket, then your body has to be preserved. If you get cremated, you can forgo this process.
- Body Transfer – your remains will have to be transported to the funeral home.
- Memorial Service – whether or not you have a casket, chances are that you want some kind of ceremony to celebrate your life.
- Hearse/Transportation – if you are to be buried, your remains will have to be taken to your burial plot. In some cases, funeral homes will provide a car for your loved ones as well.
While these components are necessary for your funeral, we haven’t even discussed things like your burial plot, coffin (or urn), and a headstone. Realistically, each one of these options will cost thousands of dollars, so you need to plan accordingly. When all is said and done, your final expenses can range from $10,000 to $20,000.
Ideally, once you retire, you won’t have to worry about debt too much anymore. Perhaps you’re still paying off a mortgage, but most of your debt should be handled before you reach 85. Unfortunately, for many Americans, debt is something that never goes away, no matter how hard you try.
One of the worst things about debt is that it can pass onto your family. Not all debt is treated the same, however, so let’s discuss the various situations where you have to worry about saddling your loved ones with this financial burden.
First of all, almost all debt is your responsibility, not your family’s. So, technically speaking, any outstanding balances you have when you die are not going to pass on to your children or relatives. That being said, there are some instances where debt can become an issue, including:
- Mutual Spousal Debt – if you bought a home, a car, or share a bank account with your spouse, he or she is liable for the remaining debt.
- Mortgage – even if you outlive your spouse, your children may want to keep your house. In that case, they will need to transfer ownership, including any outstanding payments.
- Estate Repayment – because your debt is your responsibility, your estate may be liquidated to cover any remaining balances. If you want to leave assets to your loved ones, you’ll need to take care of this debt beforehand or have a plan of action for when you pass.
So, getting life insurance for seniors over 85 can make sense if you’re trying to limit the burden of debt. For example, if you have a property that you want to pass onto your children, the death benefit from your policy can help the transition. In some cases, you may also be able to pay off the remaining balance so that your kids can inherit the property debt-free.
What Kind of Life Insurance Quotes Can Seniors Over 85 Get?
Unfortunately, you don’t have many options when trying to get a policy at this age. Typically, the only plans available are burial or final expense coverage. If you’re hoping to get a traditional term or whole life insurance policy, you will be out of luck.
If you’re over 86, there are only two companies that will insure you, so you won’t be able to compare rates or plans as much as you would at a younger age. However, you can still have some options available. Let’s break them down.
Usually, burial and final expense insurance are designed to cap off at a lower amount than a standard death benefit. While traditional life insurance benefits can get into the millions (depending on your insurer), these policies will stop around $40,000. In most cases, you can expect to get between $5,000 and $25,000 in total.
Be sure to talk with your agent about the maximum amount of coverage allowed. Also, this is where determining the reason for life insurance will come in handy. For example, if you anticipate that your funeral will only cost $8,000, you don’t need to pay for a larger policy. However, depending on your particular situation, it may still be better to get the largest death benefit possible.
The primary reason for getting a higher death benefit is that the excess can go to your beneficiaries, tax-free. So, if your funeral is $8,000 and your plan pays out $25,000, the remaining $17,000 is theirs to keep. If you’re hoping to leave some kind of inheritance when you pass on, life insurance is an easy way to do that.
Types of Benefits
Because these plans don’t pay as much as other life insurance, you often don’t need to submit to a medical exam. However, there are some factors to consider. Primarily, you’ll need to understand how your premium payments will be laid out. The three options are level benefits, graded benefits, or modified benefits. Here’s a quick overview.
In this situation, your loved ones can receive the total amount immediately. So, if something were to happen to you shortly after getting coverage, you don’t have to worry about your family missing out on the death benefit. To receive this rating, you have to be in good health, without any significant medical problems (i.e., heart attack, stroke, cancer, etc.).
Usually, when buying life insurance, there is a two-year waiting period. This time frame is designed to protect the insurance company, as they can uncover fraud or other risk factors. For example, if you got a policy after getting diagnosed with a terminal illness, the insurer won’t want to pay the full death benefit.
With a graded plan, however, your loved ones can still get paid if you pass on within two years. As a general rule, these policies will pay out 40 percent of the total within the first year, 75 percent within the second year, and 100 percent from the third year on.
This way, you can make sure that you leave something behind. If you have moderate health issues, you’ll likely get this benefits package.
Ideally, you won’t have to worry about receiving modified benefits. However, for those with significant health problems, this may be the only option.
This plan is also called “guaranteed acceptance,” as insurance companies will provide coverage no matter what. However, the trade-off here is that your premiums will be much higher, and if you die within the two-year waiting period, your loved ones will receive much less money.
Typically, if you don’t make it the full two years, these policies will pay out the amount you’ve put in, plus 10 percent interest. So, if you’ve paid $2,000 already and you die within two years, your beneficiary will still receive $2,200, tax-free. Most seniors over 85 will get a graded plan.
Life Insurance Quotes for Seniors Over 85
To help you get a better sense of your premium payments, let’s go over the average cost for both men and women at 85. Remember, if you’re 86 or older, you may not be able to get coverage at all, so don’t delay. Even if you’re unsure, it’s better to be safe than sorry.
Male – Level Benefits Plan
- $10,000 benefit – $185/mo
- $20,000 benefit – $360/mo
- $25,000 benefit – $450/mo
Female – Level Benefits Plan
- $10,000 benefit – $135/mo
- $20,000 benefit – $270/mo
- $25,000 benefit – $330/mo
Male – Graded Benefits Plan
- $10,000 benefit – $240/mo
- $20,000 benefit – $470/mo
- $25,000 benefit – $590/mo
Female – Graded Benefits Plan
- $10,000 benefit – $180/mo
- $20,000 benefit – $350/mo
- $25,000 benefit – $440/mo
Male – Modified Benefits Plan
- $10,000 benefit – $315/mo
- $20,000 benefit – $690/mo
- $25,000 benefit – $865/mo
Female – Modified Benefits Plan
- $10,000 benefit – $200/mo
- $20,000 benefit – $440/mo
- $25,000 benefit – $545/mo
As you can see, the cost of premiums can be substantial, depending on the amount of coverage you need. Also, as is typical with life insurance, women have lower rates than men because they tend to live longer and stay healthier.
Can I Get Long-Term Care Insurance At 85?
One of the issues that many people face as they get older is the need for continuing care. The cost of living in an assisted living facility is substantial, so if you don’t have a large enough nest egg, you may not be able to get the help you need.
One option that some individuals look at is long-term care insurance. However, in most cases, people will wait until it’s too late. If you’re 85 and you decide that you need this kind of coverage, you will likely be out of luck.
Even if you do get insurance, the premiums will be so high (almost $1000 per month) that it will probably be unaffordable. As with standard life insurance, the sooner you get it, the less you will have to worry.
Contact NextGen Life Insurance Today
Trying to get a policy at 85 can be challenging if you don’t have help. You need to act fast so that you don’t get denied coverage. We’ll compare plans and rates for you so that you can make the right decision for yourself and your loved ones. Don’t delay – get peace of mind right away.
Bear in mind that some of the links in this post are affiliate links and if you go through them to make a purchase I will earn a commission. Keep in mind that I like these companies and their products because of their quality and not because of the commission I receive from your purchases. The decision is yours, and whether or not you decide to buy something is completely up to you.