For Some People Seeking Life Insurance Over 50, Guaranteed Acceptance Matters
Despite their best efforts to prevent it from happening, some people find themselves in bad health. When the situation is permanent, it can affect every aspect of life. People who smoke, drink excessively, and engage in other life-threatening behaviors, as well as those with serious medical conditions, are staring at the sand passing through their hourglass of life.
For those who seek life insurance, over 50 guaranteed acceptance policies may be the only ones available.
When we review types of life insurance available, we often come across life insurance policies labeled as guaranteed acceptance. For life insurance over 50, guaranteed acceptance is an extremely popular category.
Providers of over 50s life insurance advertise that they accept any applicant, no questions asked. However, there are usually exceptions to this and they are often hidden in small print instead of being broadcast over the airwaves.
Consumers should proceed carefully when considering these over 50 life policies because failure to read plan documents thoroughly can result in wasted money.
Guaranteed acceptance life insurance policies are usually available only for people between age 50 and 80. The guaranteed acceptance Sun Life over 50 life insurance plan is available to people who are up to 85 years of age.
In addition to meeting the age requirement, individuals must be UK residents to qualify for these life insurance over 50 guaranteed acceptance plans. No medical or other health-related questions are asked and individuals are not required to take a physical examination prior to coverage being issued.
With life insurance, over 50 guaranteed acceptance policies provide a fixed cash amount paid in a lump sum to a beneficiary upon the death of the insured. This is where one of the contingencies of these life insurance policies comes into play.
Insurance providers often require that premiums on the over 50 life insurance plan be paid for several years before the cash benefit is effective. If the insured dies before that time, paid premiums may be returned to the beneficiary.
With the Sun Life over 50 life insurance plan, the beneficiary also receives an additional amount representing 50 percent of the premiums paid.
Aviva, formerly Norwich Union, over 50 life insurance policies also include a guaranteed plan for people age 50 to 80. This provider only requires one year of coverage and payments before paying out the full cash benefit.
Both Aviva and Sun Direct life insurance over 50 guaranteed acceptance plan benefits can be used to cover a variety of expenses such as funeral costs, estate expenses, or outstanding debts. Some people take out this over 50s life insurance to provide children or grandchildren with financial support after the insured has died.
With each provider, individuals select their over 50 life premium, which ranges from four to 74 pounds for Sun Life and ten to 50 pounds for Aviva. The premium of this over 50 life insurance plan never increases and the coverage never decreases, regardless of the health of the insured.
Sun Life limits the cash benefit to 20,000 pounds, while cash payouts for Aviva plans vary by age and monthly payment but never exceed 17,386 pounds. Some of these life insurance over 50 guaranteed acceptance policies may be put in trust to protect against inheritance tax. Depending on how long the insured lives, the cash payout may be greater than the amount paid in premiums.
For life insurance over 50, LV is an additional provider to consider. It offers a life insurance over 50 guaranteed acceptance plan for people age 50 to 80 with full coverage after one year. Premiums cost between five and fifty pounds per month, with a maximum over 50 plan benefit of 25,000 pounds.
With the funeral benefit option on these life insurance policies, consumers can arrange for the lump sum benefit from the plan to be automatically applied to their funeral costs.
Legal and General is another carrier that provides life insurance over 50 guaranteed acceptance plans. Three plans are included in the Legal and General over 50 life insurance offerings: fixed, increasing, and insured funeral.
The fixed over 50 plan features a set premium and cash sum that never increases, with premiums as low as five pounds monthly. Increasing over 50s life insurance offers a cash sum that increases with the cost of living and premiums increase 1.5 percent for every one percent increase in cash sum.
The insured funeral life insurance over 50 guaranteed acceptance policy covers the costs of a traditional cremation funeral. The financial benefit is reviewed in terms of the Retail Prices Index each year to keep pace with inflation.
Like the increasing plan, premiums go up by 1.5 percent for every one percent increase in the cash sum. However, this can be well worth the cost, considering that the average cremation cost is over 2,500 pounds. Though average funeral costs declined in 2010, cremation costs rose by 5.4 percent and burial costs increased seven percent.
Since the cash benefit of most life insurance over 50 guaranteed acceptance plans is fixed, its value declines with increasing inflation. This makes it important for many individuals not to rely on life insurance policies along to provide financial stability to surviving loved ones over the long-term.
Though carriers like Sun Life are now offering more coverage for the money, it still may not be sufficient to enable a surviving spouse to maintain the current lifestyle. By working with a Financial Adviser, an individual can create a comprehensive financial program for beneficiaries.
For life insurance over 50, guaranteed acceptance plans often require premium payment through 85 or 90 years of age. If the individual surpasses this age, no additional over 50 life premiums are due.
If the guaranteed over 50 plan is ever cancelled, no refund is issued for any premiums that have already been paid and no cash benefit is due after this time. One interesting aspect is that some providers will pay the cash benefit in the case of an accidental death even if it occurs within the first two years of policy issuance.
