The Best Life Insurance for Seniors

If you’re looking for the best life insurance for seniors while approaching or enjoying retirement, you’re in the right place. Many seniors think they’re uninsurable after their 65th birthday, but that’s far from the truth.

While you have fewer or more expensive options than your children or grandchildren, plenty of excellent life insurance companies offer coverage that may fit your needs. To help you find quality coverage, we’ve analyzed the best life insurance options for seniors.

Our top life insurance companies for seniors

Provider Policy type Monthly premium Why we chose it Learn more
AARP Non-level term
$100K
No exam
$272
  • Designed explicitly for seniors
  • Backed by New York Life
Quote
Mutual of Omaha Guaranteed universal
$100K
$253
  • Excellent financial and customer service marks
  • Available until age 85
Quote
Banner Life Final Expense
$15K
$130
  • No exam final expense after age 50
  • Premiums only until age 90, coverage continues for life
Quote
State Farm Level term for 10 years
$100K
$82
  • Fine-tune coverage to exact number of years
  • Convert to permanent life until age 95
Quote
AIG Guaranteed issue
Whole life
$15K
$111
  • Competitive pricing for seniors
  • Excellent final expense insurance
Quote

All rates are for a healthy, 70-year-old female. Rates are for illustration purposes only. Actual quotes may vary.  Rates are from NYLAARP.com, LGAmerica.com, StateFarm.com, Chris Abrams at MJLifeInsurance.com and a Clearlink partner. Data effective 11/19/2019.

Our methodology for the best life insurance for seniors

“Seniors” can cover a wide age range and refer to people in a variety of life stages. Choosing the best life insurance companies for a group full of such unique individuals is a challenge, so we decided to focus on the types of life insurance that seniors commonly buy. We chose companies that excel at these types of life insurance and offer these products to seniors.

Next, we looked at customer service. Most of our top life insurance companies excel at taking care of policyholders and their beneficiaries. The exception is our best value pick, which prioritized a lower price over top-notch service.

Of course, we also considered our own rating system, which is an objective analysis of a company’s financial stability and claims history.


Best types of life insurance for seniors

Many life insurance companies offer several products designed for seniors, but the best policy for you depends on your health, goals, age, and other factors.

Term life insurance for seniors

Term life insurance is usually the least expensive option for people of any age. Most insurers begin limiting the term lengths once you reach 55 or 60, so you may not find many 30-year term options after that. Once you reach 65 or 70 years, you’ll likely have limited 20-year term options as well, and so on.

Still, if you need coverage for only a limited number of years, term life will probably be your best bet.

Final expense life insurance for seniors

Insurance death benefit payouts for final expense insurance are typically $1,000 to $25,000, making them a popular option for covering end-of-life expenses, such as funeral and burial costs. But don’t let the name fool you. Your beneficiaries can use those funds however they see fit.

Typically, final expense policies are a kind of whole life insurance. You’re covered for life, provided you continue to pay your premiums. Additionally, many of these policies are either guaranteed issue or no exam life insurance, making them an excellent option for those with preexisting conditions.

Indexed universal life insurance for seniors

Universal life insurance is permanent insurance that allows the policy owner to adjust their premiums and coverage as needed. Seniors who see big changes in their future, such as retirement, travel, or downsizing, may want the flexibility of this type of policy.

All universal life policies come with a cash value, but indexed universal policies are the only ones that match your cash value growth to an index such as the S&P 500. By choosing this policy, you’ll have life insurance and a low-risk investment to help top off your retirement savings.

Guaranteed universal life insurance for seniors

This type of universal life insurance is popular among seniors. It’s less expensive than whole life but can cover you long after a term policy would end. Like other forms of permanent life insurance, guaranteed universal life coverage comes with a cash value that acts like a savings account that grows and shrinks over time with the market. Unlike other forms of universal life, this type of policy comes with minimal risk.

The “guarantee” in this type of policy refers to your coverage. No matter how your cash value investment changes over time, your coverage won’t lapse as long as you pay the same minimum premium. Unlike other permanent policies, however, this policy’s cash value may not grow much. Guaranteed universal life insurance also provides the same low risk as whole life insurance.

If you’re looking for inexpensive permanent coverage, a guaranteed universal policy could be right for you–as long as growth of cash value is not one of your priorities.

Hybrid life and long-term care insurance

The cost of long-term care insurance is on the rise, making it increasingly unattainable for many seniors. Add to that the fact that 30% of people will never need long-term care,1 and this type of insurance may not seem worth the cost. Still, if you do someday need long-term care in a nursing home or with home health care, Medicare won’t pay for most of these services.

But here’s where hybrid policies and long-term care riders can help. These products allow policy owners to combine two types of coverage—life insurance and long-term care insurance—with a single, cost-effective premium.

Here’s how it works: as with other life insurance policies, you’ll choose a death benefit amount, say $500,000. If you require long-term care later in life, you’ll be able to pull from your death benefit to pay for those services. Keep in mind, your beneficiaries will receive a lower payout. But if you never need long-term care, your beneficiaries will receive the full $500,000 death benefit when you pass away.

If you’re considering long-term care insurance and feel trapped between a rock and a hard place, a hybrid policy could be right for you.

Whole life insurance for seniors

Whole life is a kind of permanent life insurance. In general, it’s also the most expensive type of life insurance, so it’s the rare senior who can afford the premiums.

If cost isn’t an issue, whole life can be a great way to leave a tax-sheltered inheritance for your beneficiaries.


How to choose the right life insurance for seniors

Every person’s situation is different, but seniors in the same age bracket tend to have similar coverage needs. If you’re a senior who’s not sure which type of life insurance you need, find your age group below. We’re going to break down some common concerns your peers have, which may apply to you too.

Senior life insurance policies by age decade

Life insurance for seniors in their 60s

You might feel some sticker shock if you look at insurance rates when you’re in your 60s. But chances are, you’ll still have plenty of options. You’ll be able to get quotes for longer term life policies, such as 20 and 30 years.

If you’re looking for permanent coverage this time around, try indexed universal life. Its flexibility could satisfy your coverage needs for the rest of your life. This policy can also provide low-risk cash value growth you could use to supplement your retirement income later.

Finally, if you’re looking to knock out two insurance needs—life and long-term care—a hybrid policy is often cheaper than two separate policies. Just keep in mind that using your long-term care benefits may drain the death benefit payout your beneficiaries receive.

Life insurance for seniors in their 70s

If you’re in your 70s and no longer work, your income probably consists of a mix of Social Security benefits and retirement savings. You may not need to protect your income with life insurance but set aside enough funds to cover your final expenses instead. Hooray for financial independence!

If you’re still building your savings, however, you may want a short-term policy to help tide you over for a few years. A 10- or 15-year term could be a good option for you.

If you think you’ll need coverage indefinitely, however, a guaranteed universal policy might be a low-cost, low-risk choice.

Life insurance for seniors in their 80s and beyond

At age 80 and beyond, you’re unlikely to find a company that will offer you term insurance. Instead, your lowest-cost option is likely final expense insurance. The death benefit will be low (typically $1,000 to $25,000), but most policies won’t require a medical exam.

If cost isn’t an issue and your main goal is to minimize estate taxes on an inheritance, consider whole life insurance. Premiums will be some of the highest in the industry, but you’ll have coverage for life, and your beneficiaries will receive the death benefit payout tax-free.


Planning Your Future

While planning for your family’s future, consider creating a will using Fabric. Fabric is an online life insurance company that also offers a free will creation service and more.


Bottom line: Seniors have multiple life insurance options

Seniors have different needs while enjoying their 60s, 70s, 80s, and beyond. You may want the low cost of term life or a sure thing like guaranteed universal life. Or, you could have minimal coverage needs that a final expense policy would handle.

While seniors may not have as many coverage options as younger people, many top companies offer quality life insurance for seniors. Still not sure which company is best for you? Compare life insurance quotes and let your budget weigh in.

Want to learn more about life insurance? Check out these pages next:


Sources:

1  U.S. Department of Health and Human Services, “How Much Care Will You Need?


Reviewed by a licensed life insurance agent

Chelsie Ball has been a licensed life insurance agent for more than 9 years. She is focused on matching you with the best life insurance policy for you & your family.

Leave a Comment