Best life insurance for seniors in April 2024 (2024)

What should you look for in a senior life insurance policy?

When you start your search for a life insurance policy, you should consider four important areas: coverage amount, cost, how easy it is to get a policy and the company’s reputation.

• Amount of coverage: How much will your beneficiaries receive when you pass? Having the right amount of coverage to pay for your end-of-life expenses and other financial obligations is crucial.
• Cost: The cost of the monthly premium is important for seniors on a limited income. The premium needs to be affordable enough that the account holder is able to comfortably make payments each month. For example, in our study, we found that term life insurance policies for seniors average $1,275, with the cheapest companies offering rates under $1,200.
• Easy underwriting process: Some companies require medical exams while others do not. However, life insurance policies that do not require a medical exam are typically more expensive.
• Company reputation: It’s vital to work with a life insurance company that provides great customer service and reliably pays out claims.

What is life insurance for seniors?

Life insurance for seniors is, generally speaking, insurance for those 65 and older who want to:

• Leave a death benefit that can help pay for funeral expenses.
• Leave a death benefit that can cover the costs of end-of-life care.
• Provide financial security for their loved ones.
• Donate their death benefit to a charity.

While seniors can typically buy any policy they’d like up until age 85 or 90, popular choices are guaranteed issue, simplified issue and burial insurance. These policies typically have lower death benefit amounts and higher premiums relative to the death benefit.

It’s common for life insurance companies to not require a medical exam for senior-specific policies like guaranteed and simplified issue. However, the underwriting process may be different for each insurer.

Do seniors need life insurance?

Life insurance may not be necessary if you don’t have any dependents relying on your financial support or you have a substantial estate you plan to pass on to your dependents. However, life insurance can be quite valuable for many seniors because it helps dependents cover your end-of-life expenses and any medical debts you may leave behind.

Another thing to consider is that there are many policy types to choose from, some of which you can customize with riders (add-ons that provide extra benefits). Plus, even if you’refinancially secure, you may consider taking out a life insurance policy and naming a charity as your beneficiary to promote the longevity of a particular cause.

Types of life insurance plans for seniors

If you plan to purchase a life insurance policy and you’re 65 or older, there are several options for you that are tailored to your age. Generally speaking, the policies that don’t require medical exams have higher premiums in relation to the death benefit. Insurers use the higher premiums to offset the risk of insuring you without a full picture of your health.

Your options may include:

• Term life insurance: This policy protects you for a set period of time — typically 10 to 30 years — rather than for your whole life. Compared to whole life insurance, term life premiums are usually more affordable.
• No-exam life insurance: Seniors are not required to get a medical exam to qualify for this type of policy, but a brief medical questionnaire is often necessary.
• Simplified issue life insurance: These policies don’t require a medical exam but do require answers to a brief health questionnaire. Death benefits are typically $100,000 or under.
• Final expense life insurance: This policy provides a death benefit to cover funeral and burial costs, but the death benefit is typically $50,000 or lower.
• Guaranteed issue life insurance: This policy has a death benefit that’s usually capped at $25,000 and doesn’t require a medical exam or answers to a health questionnaire — coverage is guaranteed, no matter your health.

Is there an age limit to buy life insurance?

Age limits vary among life insurance companies, but for term life insurance, the standard is often around 80 years old. For whole life insurance and final expense insurance, some companies will insure new policyholders up to age 85 to 90 years old.

Alternative life insurance options for seniors

There are many life insurance options beyond the traditional ones, but some of the more popular and pragmatic options include:

• Second-to-die insurance: Also called survivorship life insurance, claims are paid out when the second person on a joint policy dies, which is ideal for couples looking to pass on death benefits to any beneficiaries they may have. Survivorship policies are usually cheaper than if each insured person bought their own policy.
• Long-term care insurance: If long-term care expenses are a concern, this type of insurance will help pay for expenses such as home health care and life-care facilities.
• Single-premium life insurance: Requires one large payment upfront and, typically, a minimum investment in a cash value account instead of monthly premiums. These policies tend to have tax implications that are different from standard policies.

You may also consider various riders available for life insurance policies. Notably, some riders make it easier for you to access affordable life insurance in the future or allow them to access their own death benefit in certain situations. Here are some life insurance riders that seniors might consider:

• Term conversion: A term conversion rider allows you to convert their term life insurance policy to a permanent life insurance policy, offering you life-long coverage without going through another medical exam or other eligibility requirements.
• Guaranteed renewability: This type of rider allows you to automatically renew your life insurance policy after your term expires. Premiums are generally higher, and you may have to renew each year rather than getting another 10, 20, or 30-year term.
• Accelerated death benefit: In certain situations, an accelerated death benefit rider allows you to access your death benefit early, such as if you’re diagnosed with a certain terminal, critical, or chronic illness or if you need money for long-term care.
• Accidental death benefit: This type of rider can increase the size of your policy’s death benefit if your death was the result of an accident rather than an illness or other medical event.

Life insurance for seniors with no medical exam

Certain insurers offer what’s known as “no-medical-exam” insurance. These policies allow you to fill out a simplified application that does not require you to answer in-depth questions about your health or take a medical exam. Because of this, no-medical-exam policies can be a great fit if you’re dealing with health issues that would otherwise disqualify you from coverage. However, it’s likely you’ll pay a high premium relative to your coverage amount.

Term policies are usually the most popular no-medical-exam choices, but many companies also offer guaranteed whole life policies, too.

Factors that affect senior life insurance rates

Generally speaking, your age and health have the biggest impact on your life insurance rates. The older you are and the sicker you are, the higher your premiums will be. Other factors that impact your rates include:

• The type of policy you buy: Term policies tend to cost less for the amount of coverage you get than whole life policies do.
• Gender: Women tend to have lower premiums than men.
• Coverage: The more coverage you buy, the higher your premium usually is.

Is life insurance worth it for seniors?

Life insurance isn’t worth it for every senior. For example, if you have enough money saved and invested to support anyone who relies on your income if you die, or you don’t have anyone relying on your income and have enough money to cover end-of-life and funeral expenses, you may not need a life insurance policy.

However, if your resources are sparse and you have people relying on your income to keep them afloat financially, life insurance can be a wise choice. While policies tend to cost more if you sign up for the first time as a senior, you should have several options for coverage that can provide stability for family members if you pass.

Life insurance industry trends in 2024

More than 40% of adults in the United States either don’t have life insurance or they don’t have sufficient coverage, according to the 2024 Insurance Barometer Study. However, seniors are more likely than any other generation to have life insurance. Nearly 60% of baby boomers have life insurance coverage.

Of those seniors who don’t currently have life insurance (or who don’t have enough life insurance), the primary reason they stated was that it’s too expensive. Next, seniors cited other financial priorities that prevent them from having enough coverage.

Also relevant to seniors, it’s become increasingly common for insurers to offer—and for consumers to purchase—combined life insurance and long-term care products. These products allow seniors to leave money behind for their loved ones, while also ensuring they’re able to meet their long-term healthcare needs.

The increased interest in these products lines up with the current financial concerns of most seniors. The Insurance Barometer Study found that, while most generations are most concerned with having enough money for a comforatble retirement, seniors are more concerned about being able to pay for long-term care services.

A final life insurance industry trend worth noting is the rising prices. LIfe insurance premiums are generally rising faster than wages, which further exacerbate the problem of many people—including seniors—finding life insurance to be too expensive.

Methodology

To find the best life insurance companies for seniors, we examined 13 leading insurers based on seven crucial categories, leveraging data from trusted life insurance analytics specialist Veralytic, complaint data from the National Association of Insurance Commissioners (NAIC) and study data from customer-research firm J.D. Power.

Overall, we worked through more than 180 data points to identify winning companies. The following sections describe the category we scored and the weight we gave that category in our scoring model:

Financial strength (20%)

Because life insurance for seniors is typically meant to cover costly end-of-life expenses, a company’s ability to pay out your claim decades from now is a key point of trust. We used Veralytic scoring for financial strength, which compares an insurer’s ratings from various agencies like AM Best, Fitch, Moody’s and Standard & Poor’s to other insurers. Each agency’s ratings reflect the rated company’s ability to fulfill its financial obligations and weather economic turbulence.

Cost competitiveness (20%)

For cost competitiveness, we used data from Veralytic, which calculates a policy’s fees and costs per $1 of death benefit. It then compares a company’s aggregate and individual expenses to industry averages.

Illustration reliability (20%)

An insurer’s illustration is a document that shows you all the important metrics you need to know about your policy, including the benefits your policy offers, your premiums, expenses you’ll pay through your premium, how long you’ll pay premiums and the policy’s projected death benefit and cash value. Because illustrations are critical to your buying decision, we’ve included a score for them. The score is based on a policy accuracy analysis from Veralytic, which scores a company based on how accurate its illustrations’ cash value and death benefit predictions are.

Customer service (13%)

J.D. Power scores insurance providers based on five factors that are a key part of the customer experience: communication, interaction, price, product offerings and statements. We include J.D. Power’s 2022 ratings in our scores because they help you gauge what an insurer’s typical customer experience is like.

Access to cash value (12%)

Building cash value is part of the appeal of permanent life insurance, but a policy can be frustrating if your options for accessing your cash value are limited. For this category, we used Veralytic data that rated companies higher if their cash values were higher and had greater liquidity than what’s typical for the industry.

Historical performance (10%)

We used Veralytic ratings to judge a company’s historical performance. The ratings measure the average return for the past five years in an insurer’s cash value policies compared to the average returns of other insurers. Although past results don’t guarantee future performance, a life insurance company with a history of assets that perform well can be a positive sign for policyholders.

Complaint rate (5%)

The National Association of Insurance Commissioners (NAIC) calculates an index for insurance companies based on the company’s share of premiums and complaints filed with the NAIC. An index of 1.00 indicates the insurer received the expected number of complaints for a company of its size. An index below 1.00 means the company received fewer complaints than expected for a company of its size and vice versa. For each company, we calculated its average NAIC index over the past three years across all subsidies offering life insurance.

What didn’t make the cut

Of the 13 companies we analyzed, five didn’t make it into our final picks: John Hanco*ck, Transamerica, Equitable, Guardian, and Ameritas. Each of these companies lacked in certain areas, whether it be because of high premiums, low value, or unreliable policy illustrations.

Frequently asked questions (FAQs)