Do Elderly People Need Life Insurance?

You may think that once somebody has passed into retirement age, that they have outgrown their need for a life policy. Sometimes this is true. But sometimes older people can put a policy to very good use. If you have an idea that you, or an older person that you know, may need coverage, look at some reasons that older people use life policies!

• Transfer Wealth To Heirs - This is probably the first thing that most people think of when they think about elderly people having life insurance. It is a tax advantaged and affordable way to transfer an estate to the next generation. Sometimes it is also used to transfer money to a favorite charity or foundation too. The death benefit of the policy can be divided between different beneficiaries in whatever amount that the owner wishes.
• Final Expenses - You have probably seen a lot of ads for senior life, burial policies, or final expense insurance. These are smaller face value whole life policies that are designed to make it easy for seniors to apply for. They are usually purchased by people with modest assets who are concerned about the expense of funerals and other costs which come at the end of life.
• Business Policies - There are a couple of reasons that business owners or important (key) people in business may need life policies. These become more important as these people get older. One reason may be to ensure the business can continue if it has to replace an owner or important employee. This is called Key Man insurance. In other cases, a policy may be needed to secure financing for some business venture.
• Settle Family Disputes - Let us say that one heir is to inherit a home or business. A life insurance policy can be a way to make sure that other heirs are compensated. For example, let us say that Mr. Jones plans to leave his law firm to his daughter, who is also a lawyer. He plans to leave his home to his wife and another daughter who had become disabled. He could use a life insurance policy to compensate a third daughter who will not stand to inherit his other large assets
• Cash. Value Life Insurance - Some other uses of cash value policies can be enjoyed while the insured person is still alive. Some policies can grow a cash value that can be borrowed against, surrendered for cash to the insurer, or even used in a senior life settlement.

Before you shop for a policy for an elderly person in your family, it is important to understand why you think that person needs coverage. That way, it will be easier to decide the type and amount of coverage you should purchase.

For example, if you are concerned about funeral costs, you may consider a small burial policy. This can be an affordable way to pan for the high cost of funerals. If you are worried about a family dispute, you may want to look for a policy that can compensate some heirs who will not inherit any large assets. Either way, when you know what you want to gain from a policy, it should be easy to find the right plan for you!

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