Best Life Insurance For Seniors

There are many reasons you might decide that you need to invest in life insurance when you enter your senior years, generally considered age 65 and above. Our circumstances change, and you may not already have the coverage you need in existing policies.

But finding a good life insurance policy when you are considered “senior” by life insurance companies can be challenging. They charge higher premiums and place greater restrictions on their policies to offset the risk that they will have to pay out.

But, as people are living longer and healthier lives, some insurance companies are catching up and offering better, more affordable policies.

We have pulled together a list of the six best insurance providers if you are looking for a policy as a senior. We have also put together a buying guide to help you choose the right policy for you, depending on what you are trying to achieve.

6 Best Life Insurance Companies For Seniors

When putting together our list, we have only considered insurance companies with an “A” AM financial rating, so you can feel safe that your investment is secure.

Product Name Features Best For.. Link To Product
Mutual of Omaha
  • Policies up to age 85
  • Term policies until age 80
  • Affordable rates, especially for low-value policies
Best for term life insurance for seniors Visit Site
Transamerica
  • Term and whole life plans until age 85
  • Low premiums
  • Benefits pay out from day one
Best for whole life insurance for seniors Visit Site
AIG
  • Low-rate final expenses insurance
  • Pays out 50% for chronic or terminal diseases for no additional charge
Best for final expense insurance for seniors Visit Site
Banner
  • Offers new term and whole life policies up to the age of 75
  • Some of the lowest premiums on the market
Best affordable life insurance for seniors Visit Site
MassMutual
  • Offers term life insurance that can be converted into whole life insurance
  • Offers whole life insurance at more than $25,000 for seniors
Best flexible life insurance for seniors Visit Site
Gerber
  • Policy benefits if a young grandchild is named as beneficiary when taking out the policy
  • Value of the policy doubles when grandchild turns 18
Best for looking after grandchildren Visit Site

Best Life Insurance Companies For Seniors Reviewed

Mutual Of Omaha – Best For Term Life Insurance For Seniors

A big-name insurance provider that you can trust, Mutual of Omaha offers more options and better rates for seniors.

They offer term life insurance policies up to the age of 80, which can be renewed annually until the age of 94. Available coverage levels are high, starting at $100,000. This can be compared to many other companies that cap their policies at around $25,000.

They also offer whole life insurance policies up to the age of 85, with options from $2,000 to $25,000.

Their rates are mid-range for high-value policies. An average 65-year-old male can expect to pay around $119 a month for a 10-year term policy worth $250,000. But they offer very good rates for low-value policies. For a $10,000 policy, a 65-year-old male can expect to pay just $66 per month, and an 80-year-old male $166 per month.

Transamerica – Best For Whole Life Insurance For Seniors

Transamerica offers both term and whole life insurance policies for seniors up to the age of 85. They offer higher levels of coverage than many other providers, offering $40,000 up to age 65, $30,000 up to age 75, and $25,000 up to age 85.

Moreover, with all of these policies, benefits will pay out from day one. Many insurance policies require seniors to wait two years before their policies start paying out.

Premiums are low. An 80-year-old man can expect to pay $376 per month for $100,000 in coverage.

AIG – Best For Final Expense Insurance For Seniors

AIG is another big-name insurer, so you can be confident in their underwriting of your investment.

They specialize in offering final expense insurance for seniors, between $5,000 and $25,000. Acceptance is guaranteed up to the age of 85, and rates are very affordable. A 70-year-old male can expect to pay just $98 per month for $25,000.

As well as being able to cover funeral costs, for no extra fee this policy will pay out up to 50% of your death benefit if you are diagnosed with a chronic or terminal illness, to help cover essential costs.

Banner – Best Low-Cost Life Insurance For Seniors

Banner life insurance, operating under the Legal & General brand name, offers a more limited range of life insurance policies for seniors but some of the lowest premiums on the market for those they do cover.

They only offer new policies up to the age of 75, with term coverage through to the age of 90. They also offer final expense and universal whole life insurance options for under-75s.

Rates are well below the market average. For example, a 65-year-old man looking for $100,000 through a 10-year term policy will pay $53 per month. For a 20-year term for $500,000, that same man can expect to pay $385 per month. That might seem like a lot, but it is still one of the lowest premiums available for this kind of policy.

MassMutual – Best For Flexibility Insurance For Seniors

MassMutual is good for seniors because it offers term life insurance policies that can be converted into whole life insurance policies as your needs change. Term policies can be purchased up to the age of 64.

They also offer standard whole life policies for seniors, guaranteed up to $25,000, and larger amounts can be secured by speaking with an agent. You are also still able to borrow against the cash value of your whole life insurance policy if you wish.

Gerber – Best For Looking After Grandchildren

For seniors specifically looking to support grandchildren going into the future, Gerber offers the ideal plan.

If you take out a Gerber Grow-Up Plan and name a grandchild as the beneficiary, the policy will immediately double when the grandchild turns 18. At age 21, the grandchild becomes the policy owner and they can decide whether to continue paying into the policy to get the full value in due course, or withdraw the current cash value.

Policies can be affordable. You can expect to pay as little as $31.40 per month for a $50,000 policy, as long as you sign up before your grandchild turns one. The maximum death benefit payout is $100,000, but that can make a big difference to your beloved grandchild.

Fore more reviews of life insurance companies read: Best Life Insurance Companies.

Life Insurance For Seniors: Buying Guide

Whole life insurance for seniors is the same as life insurance at any age, it tends to be more expensive and more restrictive. Life insurance companies view covering seniors as higher risk due to the increased likelihood that they will have to pay out before sufficiently covering their costs through premiums.

As life expectancy and quality of life improve, life insurance companies are realizing that they can benefit from offering good policies to seniors. There are now a range of options on the market, especially for those between the ages of 65 and 80.

Finding affordable life insurance for over-80s is more challenging, but you can read more about that here: Best Life Insurance Options For Seniors Over 80.

Why Do Seniors Need Life Insurance?

When deciding which life insurance is right for you, you need to start by having a clear idea of why you need life insurance. This will help you determine what kind of life insurance you need and whether life insurance is, in fact, the best option.

The main reasons seniors may decide they need life insurance include:

  • Cover final expenses  These include funeral and burial, relieving the burden of paying for these things from loved ones.
  • Cover inheritance tax – If you are leaving a large estate that will incur inheritance tax, a death benefit can be used to pay the tax, rather than forcing your heirs to sell assets to pay it.
  • You still have debt or dependents – While it is often assumed that once you retire, you don’t need life insurance to cover lost income or pay the bills, if you are still supporting a spouse, children, or other dependents financially, you may want to be able to support them after you are gone.
  • To give a gift to family members – You may be looking at life insurance as a means of leaving financial support for children or grandchildren.

Of course, there are many other reasons why you might want life insurance, as everybody’s situation is different.

Best Type Of Life Insurance For Seniors

The best type of life insurance for seniors depends on what you are trying to achieve.

The first decision to make is whether you need whole or term life insurance. Whole life insurance is the form of life insurance that most people are familiar with. You pay into it for your whole life, and it is guaranteed to pay out upon your death.

Term life insurance is a policy you take out for a fixed term, perhaps 10 years. If you die during the period of the policy, it pays out. If not, the policy has no value and your beneficiaries receive nothing.

While this might not seem like a good deal, term insurance policies generally cost about 10 times less than whole life insurance policies. This makes them a good option when you are trying to protect your family during a period of risk, such as the duration of a mortgage or other large debt.

Choosing A Policy

Whether you should be looking at a term or a whole life policy depends on you. Also, bear in mind that you may not be eligible for term policies depending on the insurer and your age.

If you are looking at end of life costs and inheritance tax relief, then you are probably looking for a whole life insurance policy that will pay out no matter when you die.

How much you need will depend on your situation. The average funeral costs around $10,000, though you will want to calculate more specific costs for what you want and add a buffer for inflation. You will also want to calculate what the inheritance tax on your estate is likely to be depending on the state in which you live.

If you are covering a specific debt, or a specific period of dependence—for example, children who have not yet completed college—a term policy may be a better option, as you get the protection with significantly lower premiums.

If you are trying to do both of those things, there is no reason why you cannot have two policies: a low-value whole life insurance policy to cover end of life expenses and a high-value term policy to cover more immediate risks.

If you are looking to leave a legacy to a family member, you may want to shop around for specific policies for this, such as the policy for grandchildren offered by Gerber. But, in addition to comparing insurance policies, it is worth comparing other investment options.

For the same investment, you may be able to grow the pot of money you have to leave to grandchildren more quickly with something like a mutual fund. Moreover, if you live longer than expected, you can give the funds to them when they need it rather than having a policy that only pays out upon your death.

The Verdict

The life insurance market is finally catching up with the demographics and offering reasonable life insurance policies for seniors over 65.

While it is necessary to shop around to find the best rates and best options, it is now relatively affordable and easy for seniors to find life insurance that fits into their budget and can take care of what is important to them after they are gone.