Life insurance is something that everyone should have because it provides financial assistance to surviving loved ones when we die. Though we can take out life insurance policies at any age, experts especially recommend life insurance over 50 years old because the chances of us dying increase.
When getting life insurance, over 50s pay more than if they took out a policy when they were younger. However, the policy premium is usually much less expensive than it will be for surviving loved ones to cover funeral expenses and their own living costs. Learn more about over fifty life insurance in order to find the right policy and the best cost.
Over Fifty Life Insurance Options:
Life insurance protects our income to provide for dependents or cover living expenses if we die or become sick.
The types of life insurance over 50 do not vary from those available to UK residents who are younger.
For life insurance, over 50s select from term and whole life policies. The correct over fifty life insurance plan varies by individual and are based on factors like age, number of dependents, income level, and financial liabilities.
Multiple carriers may offer an adequate over fifty life insurance plan, so consumers should compare life insurance over 50 policy terms and premium rates to find the best deal.
Categories Of Over Fifty Life Insurance:
An over 50 life insurance plan tends to fall into one of two major categories. Life insurance over 50 protection policies provide a benefit should a specific event occur. An example of a protection policy is term life insurance over 50s can find online.
The benefit usually comes in the form of a lump sum payment. Investment policies are designed to facilitate capital growth through premiums. Whole life insurance is a type of investment life insurance over 50s will find.
Life Insurance Over 50s-Term:
Term life insurance policies cover a fixed term and the over fifty life insurance sum listed on these policies is payable upon the death of the policy holder. Should the individual survive through the expiration date of the policy, no payments or investment benefits will be issued.
Premiums are based on the health and age of the insured, the sum to be issued, and the term of the policy. Over fifty life insurance will cost more than under 50 and a longer term will carry a higher premium than a shorter one.
Term policies for life insurance over 50 may be written on one life, joint lives, or on life of another basis. Joint life insures two or more lives, paying proceeds upon either the first or the second death that occurs.
When taking out this life insurance, over 50s must have a financial interest in the person whose life is being insured. Insurance carriers may request proof of this in order to approve coverage. When it comes to this life insurance, over 50s may find their own lives being insured by multiple family members.
With the term insurance category, types of life insurance vary by the amount of coverage offered throughout the term. Level term life insurance over 50 provides the same amount of coverage and premium during the entire term. A payout is made only when the insured dies during the designated term. This over 50 life insurance is often used to provide dependents up to a certain age with financial security.
With decreasing term life insurance, over 50s have coverage that declines during the designated term. This coverage is suitable for people who want to make sure that a reducing debt like a mortgage is covered if they die during a certain period. Since the payout decreases over time, life insurance quotes for this type of term insurance are lower than for level term insurance.
Mortgage life insurance is usually a declining face value policy with a level premium. The face amount of the policy equals the amount of the mortgage held by the insured. If this person dies before the policy expires, the named beneficiary receives the payout. With this life insurance, over 50s who are homeowners ensure that beneficiaries are not financially burdened with another mortgage payment.
Life Insurance Over 50- Whole:
Whole life insurance provides protection for life, whether someone takes out the life insurance over 50 or under 50. While term insurance only pays if the individual dies during the policy term, whole life insurance over 50 coverage always pays because it lasts forever.
Whether for under or over fifty, life insurance quotes are higher than for term insurance. The premium for life insurance over 50s pay is usually fixed for the first ten years. At that point, the carrier reviews the policy to determine whether the investment fund can sufficiently maintain this premium. If not, the life insurance over 50 premium may be increased or the coverage sum decreased.
In the UK, the main type of whole life insurance over 50s will find is called unit-linked. This provides life coverage plus an investment aspect, with the mixture determined upon policy issuance. Each month, the premium is used to purchase units of a selected investment fund.
The cost of the policy is calculated monthly and deducted by turning in over fifty life insurance accumulated units of an equivalent value. Policy value grows as units accumulate and the value of each unit increases. Fund performance and premium costs determine investment growth for the holder of life insurance over 50.
Universal whole life is an under and over fifty life insurance whole life plan that offers additional benefits. Investment units may also be redeemed to purchase critical illness and permanent health insurance as well as personal accident and hospital income benefits. With this life insurance, over 50s can use one policy to cover all their protection needs. As their needs change, they can switch from protection to investment.
Suicide And Its Effect On Life Insurance:
In the past, death by suicide was always exempted for payout of over fifty life insurance. However, legal action has led to payouts for suicides due to reasons other than benefitting from the policy. In general, paid premiums are returned if the insured commits suicide within the first two years of taking the policy. After that time, the death benefit is usually paid to beneficiaries of life insurance over 50s designate.
Carriers Providing Life Insurance Over 50:
When searching for life insurance, over 50s can find it through four carriers: Aviva (Norwich Union), Legal and General, Sun Life, and Liverpool Victoria (LV). Aviva, Norwich Union over 50 life insurance quotes start at five pounds per month and UK residents can purchase under or over fifty life insurance online.
Monthly payments are guaranteed never to rise and both level and decreasing life insurance over 50 coverage is available. With these types of life insurance, over 50s policyholders never have a cash value and if they cease paying premiums or survive plan termination, coverage ends and no money is returned.
Legal and General over 50 life insurance includes several plans and consumers can apply online to receive an immediate decision. Life insurance over 50 with this carrier costs as little as five pounds a month and comes in the form of a fixed, increasing, or insured funeral plan.
UK residents can also find an over 50 plan for mortgage life insurance, so surviving family members can afford to pay the mortgage after they die. Those with a repayment mortgage should review the over fifty life insurance mortgage decreasing policy that costs as little as six pounds monthly.
Sun Life over 50 life insurance has recently been improved so individuals from age 50 to 85 can provide beneficiaries with a sum of cash for only four pounds per month. New life insurance over 50s plans taken out with this carrier feature a larger cash sum.
This provides additional financial peace of mind during these difficult economic times. Sun Life provides life insurance over 50 guaranteed acceptance plans for UK residents age 50 to 85, no health or medical questions asked. This carrier currently has the lowest life insurance quotes available for this life insurance over 50 plan.
For life insurance over 50, LV also has competitive plans including life insurance over 50 guaranteed acceptance plans for 50 to 80 year olds. Premiums range from five to 50 pounds per month with a maximum coverage of 25,000 pounds available.
After one year, over fifty life insurance policy holders receive full coverage and the plan includes a guaranteed lump sum of cash as well as a funeral benefit option.
UK residents should compare life insurance for over 50s offered by each of these carriers. Since the life insurance quotes will be higher than for someone younger who is in good health, those over 50 can save money by comparison shopping.
They will soon realize that in terms of life insurance, over 50s really do not have it that bad. Premiums for an over 50s life plan are actually quite reasonable, even for a guaranteed over fifty life insurance policy.
Taxation Of Over Fifty Life Insurance In the UK:
Whether under or over fifty, life insurance premiums are not usually deductable against corporation or income tax of the insured. That being said, qualifying life insurance over 50 polices issued before March 14, 1984, are still entitled to 15 percent Life Assurance Premium Relief (LAPR), with the next premium deducted by the holder of the over 50 plan.
A claim on non-investment life insurance over 50 is not normally subject to capital gains or income tax. Tax treatment for a policy featuring an investment aspect, such as a whole life policy, is determined by its qualifying status.
If the over fifty life insurance policy meets certain criteria, qualifying status is established during issuance. Contracts of ten years or more are usually deemed qualifying, so proceeds are not subject to capital gains or income tax.
If they have short term or single premium life insurance, over 50s may need to pay income tax depending on their marginal rate during the year the gain was earned. Taxation of life insurance over 50 is complex, so the insured should pose questions to the insurance carrier and an accountant.
The proceeds of an over 50 life insurance plan are included for inheritance tax purposes. However, a policy written into a trust may fall outside of these guidelines. Laws regarding trusts and their taxation are extremely complicated. When establishing a trust and including life insurance, over 50s should consult with a solicitor or an Independent Financial Advisor.
How To Compare Life Insurance For Over 50s
To compare life insurance, over 50s should request life insurance quotes from all insurance companies offering relevant products. The first step in this process is to determine the type of over 50 plan and level of coverage.
If they want term over 50 life coverage, consumers should determine term length. That way, when they request quotes for life insurance, over 50 year olds receive prices that reflect the same coverage. If they want mortgage life insurance quotes, consumers should know the outstanding mortgage balance.
Once they have all the over 50 life insurance quotes, consumers should review them again to make sure they are for the same types of life insurance with the same payout levels and terms, if applicable.
They should then compare life insurance premiums to find the cheapest over fifty life insurance rates. Once the least expensive over 50s life plan is found, they should finalize the relevant contract and make their premium payment.
This general overview of life insurance over 50 should help any UK resident find the correct plan at the lowest price. When they compare life insurance, over 50s should make sure they are looking at the same types of life insurance, whole or term life, and life insurance quotes for the same level of over fifty life insurance coverage.
When some research and careful shopping is done, over fifty life insurance represents a good financial investment because it relieves financial burden on surviving loved ones.