Written by You’ll be able to purchase a life insurance policy if you’re over 60 that can offer you coverage based on your stage of life. In most cases, though, insurers will have an upper age limit which applies to seniors buying their first policy. This does tend to vary depending on who you decide to buy with, but it generally rules out seniors over 75 who haven’t already purchased coverage. If you’re considering taking out a life insurance policy, Savvy can help you find one which is right for you.
Why compare life insurance through Savvy?
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We’ve partnered with Compare Club to bring you a range of life insurance policies to help you compare them side by side.
What types of life insurance can seniors purchase?
No matter if you’re a senior over 60 or even 70, there are types of life insurance policies on the market which can cover you. It pays to compare these forms of insurance with Savvy to see which one best suits your situation. Some of these include:
Life cover
In Australia, life cover is the most widely held policy. Life insurance typically covers you until you reach 100 and pays out to your family if you pass away. You may also receive money if you're diagnosed with a terminal condition, while you can get funds ahead of time to assist in paying for your funeral.
Income protection insurance
Assuming you haven’t yet retired, this kind of insurance will pay up to 70% of your usual wage (generally monthly) if you become temporarily unable to work due to an accident or sickness. Income protection insurance does not cover redundancy. Some Australian insurance companies cover those over 60, although most of them do not.
Total and permanent disability (TPD) insurance
Your insurance company will provide you a lump sum payment if you become fully and permanently handicapped and are never able to work again. It's important to note that although most insurance policies have an age restriction for those over 65, others have a later cut-off.
Trauma insurance
Seniors over 60 or 65 can take out trauma insurance, either as a new policy or as a rider to their current life insurance. Trauma insurance often covers up to fifty different medical conditions, including heart attacks and strokes.
What are some of the benefits of seniors life insurance?
As we age, the prospect of leaving our loved ones to pay for mounting medical expenditures in the event of your death can be a real worry. However, life insurance provides an invaluable safety net so you won't have to fret about how your family will make ends meet. This way, your benefit can be used to clear debts and cover some of those final expenses if needed.
If you're trying to decide if life insurance is something you need, it's essential to consider some of the benefits, including:
- Peace of mind: buying life insurance can alleviate the stress of thinking about how your loved ones would manage financially in the event of your untimely death. By comparing with Savvy, you can find a policy that's specifically tailored to your stage of life and can cover you up to 75 or 85 years old and beyond.
- Terminal illness expenses: if you're diagnosed with a terminal illness, you may be up for the cost of your treatment, medication and alternate therapies. Having life insurance can safeguard you and your loved ones from paying for your funeral and some of that other final expenditure out of their own pockets or from your savings.
- Clear your debts: you may still have outstanding bills such as a mortgage, credit card balances or personal loans even if you’re nearing retirement age or over 80 years old. You can ease the financial load on your loved ones after your death by taking out life insurance to help settle any outstanding bills.
- Dividing your estate: you can name one beneficiary to inherit your home or company, holiday home, and other assets while designating another family member to receive a lump sum from your life insurance policy, which can help keep these assets remain in the family.
The types of life insurance
What factors determine the cost of seniors life insurance?
Your age
In general, the cost of life insurance rises with age, so delaying the purchase until later in life might result in a hefty premium increase. The reason for this is because as people become older, they become more susceptible to sickness and pose a higher risk to the insurer. As such, you’re likely to pay more for your policy than a younger person.
Your gender
Women often pay less for their life insurance because they have a greater life expectancy than men. However, this will only be a relatively minor factor considered when working out how much you pay for your policy.
Your health
It goes without saying that taking care of yourself may help you lower your life insurance premiums. You may also qualify for a lower premium even if you have a pre-existing condition like high cholesterol or blood pressure. In some cases, you may need to undergo a medical evaluation of your body mass index (BMI), blood pressure and general health. Your insurance company may enquire as to whether anybody in your family has suffered from cardiovascular disease, cancer, diabetes or a severe mental condition like bipolar disorder.
Your work
If your insurance company sees your industry as more dangerous, you may see a rise in your premiums even if you keep your day job. For instance, the cost of life insurance for firefighters is typically higher than for someone with a standard office job.
Smoking or non-smoking
Life insurance premiums for smokers are often two to three times as high as those for non-smokers. Insurance companies will only consider you a non-smoker if you have been smoke-free for at least a year.
Your hobbies
Your premiums will likely be lower if you indulge in activities like reading, bridge and walking than if you are a frequent bungee jumper or parasailer.
How to buy a life insurance policy through Savvy
Frequently asked questions about life insurance for seniors
If you’re looking for a seniors’ life insurance policy, comparing with Savvy will help you sniff out the right one for you and your loved ones. Some of the factors worth comparing include:
- What’s included and what isn’t
- The price of your premiums
- The maximum levels of coverage
- Any other benefits (for example, coverage suspension or advance payments)
- Waiting periods (these can range from a few weeks to a few months)
You'll need to choose a life insurance beneficiary when purchasing a policy. If you choose a spouse, child or grandchild to receive the payment in the event of your death, that person will receive any benefit payable on your death by the insurance company. You may name a child, grandchild, business partner, friend, sibling, or trust to handle your affairs if you pass away.
If you’re leaving your payout to a grandchild, they must be at least 18 years old to lawfully receive a payout in their name. They would also need a trustee or legal guardian to handle the funds until then. It’s important to inform your chosen recipient of your decision. This is because a beneficiary will need a copy of the death certificate to file a claim after the insured has passed away.
Yes – you can buy life insurance on behalf of your parents if they’re too sick or find the process too complicated. However, you must get their written permission before you purchase a policy and you must prove that their death would financially impact you.
Many life insurance companies won’t cover pre-existing conditions under your policy. However, there are exceptions if you shop around. For example, some providers will offer you a partial benefit for a payout related to your pre-existing condition or afford you total coverage for it at an additional cost.
You and/or your loved ones are free to spend a life insurance settlement in any way you see fit, including on final expenses, continuing living expenses and anything else that could arise because of your passing.
The long and short of it is that Australians travelling overseas can be covered by their life insurance policies, but there are a few details to iron out. It’s best to consider:
- The terms of your life insurance policy
- Whether your policy excludes coverage in certain countries
- If you’re planning to be away for longer than five years
- Other types of coverage while you’re on holiday, such as travel insurance
Helpful guides on life insurance
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Disclaimer:
Savvy is partnered with Compare Club Australia Pty Ltd (AFS representative number 001279036) of Alternative Media Pty Ltd (AFS License number 486326) to provide readers with a variety of life insurance policies to compare. Savvy earns a commission from Compare Club each time a customer buys a life insurance policy via our website. We don’t arrange for products to be purchased from these brands directly, as all purchases are conducted via Compare Club.
Savvy does not compare all life insurance policies or providers currently operating in the market. Any advice presented above or on other pages is general in nature and doesn’t consider your personal or business objectives, needs or finances. It’s always important to consider whether advice is suitable for you before purchasing an insurance policy.
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