It is customary to buy permanent life insurance, such as Whole Life or Universal Life, for estate planning purposes by the time one is 62 years old. Term life insurance is ideal for responsibilities that must be met over a shorter period of time.
These include replacing lost income before retirement etc. Term insurance is more cost-effective for bigger coverage levels, such as those required to cover a mortgage or debt repayments.
In comparison to Whole Life insurance, Guaranteed Universal Life (GUL) is much less costly. It provides coverage with a no-lapse guarantee at a set premium until a certain age.
Life insurance for those over the age of 62
Occasionally, purchasing or keeping a life insurance coverage beyond reaching the age of 60 makes sense. Whether you decide to increase your coverage or decrease it, your retirement years are often an excellent opportunity to reevaluate your life insurance.
As you approach your 60s, you may discover that you need life insurance more than before.
You are still employed
If you and your spouse rely on your income, it's prudent to ensure that income after you die. Hence, life insurance is a good thing.
You have substantial financial worth
Financial advisers often offer permanent life insurance to individuals with estates greater than $11.7 million in order to reduce inheritance taxes.
Your family financially relies on you
Consider maintaining coverage if you continue to support children or other family members. This is to ensure that they have protection after your death.
You want to live off your cash value
Some retirees support their retirement years via withdrawals from the cash value of their permanent life insurance policies.
What is it like to get an insurance policy at 62?
The fact that you did not get life insurance throughout your 20s, 30s, or 40s, and are planning to do so now while in your 60s, you may find yourself in a precarious financial situation. As you get older, the cost of life insurance rises, and any health concerns will make it more difficult.
Whole life insurance
If you are 60 years old and in perfect health and want to get a $100,000 whole life insurance policy, according to quotes from Quotacy, a life insurance agency, the cost is around $257 each month.
The identical entire life insurance coverage for a 30-year-old costs just $72 per month, according to the same source.
As an older person approaching 60, you may be better off just saving the $3,000 or so each year that you would have paid to an insurer for a whole life insurance policy. As a result, you'd have more control over your finances and more direct access to the cash you accumulate.
The disadvantage of using this route is that, if you die sooner rather than later, your heirs will not get a life insurance death benefit, which might be far bigger than the amount of money you've saved in only a few years.
Term life insurance
A term life insurance policy may also be available to you if you are in generally excellent health. It is often far less expensive than whole life insurance. According to Quotacy, a healthy 60-year-old may qualify for $100,000 in life insurance with a 20-year term for as little as $38 to $52 per month if he or she is in good condition.
For those in poor health, guaranteed issue life insurance may be the only option available to them. This kind of insurance is normally costly, but there is no chance that you will be turned down for coverage.
For a 60-year-old male, a $25,000 guaranteed issue insurance would cost an average of $144 per month on average. For those who pass away within two years of purchasing a life insurance policy, the insurance company will normally not pay the entire benefit. However, it will simply return the premiums that were already paid.
What can I do to ensure that I obtain the greatest life insurance premiums possible?
Once you have obtained the best life insurance rates at age 62, you should begin working on your lifestyle. Some of these habits are as follows:
● Put an end to your smoking habit.
● Start exercising or continue to exercise if you already do.
● Keeping medical issues such as high blood pressure under control, with the use of medicines if necessary
● If you are overweight, you should lose weight in accordance with normal height and weight recommendations.
● Drinking more water is a fantastic habit to develop for our bodies' wellness.
● Do not participate in hazardous employment or high-risk hobbies or pastimes
● Motorcycles should not be used.
● Consume foods that are good for your heart.
Converting or renewing your insurance
If you purchased a whole life insurance policy many years ago, you will be able to have that coverage forever. Whole life insurance provides long-term protection, which means you may maintain it as long as you continue to pay.
There are a few alternatives available to you if you presently have term insurance and want to extend your coverage. You can do the following:
Renew your term insurance coverage
Many term life insurance policies enable you to renew your coverage at the conclusion of the term period. If you wish to retain your current coverage after reaching your 60s or 70s, this may be a suitable alternative.
In this way, you will not be required to have a life insurance medical exam in order to keep the policy. Keep in mind that your premium will rise. And, some companies will not let you renew your policy once a certain age has passed.
Convert your term life insurance coverage to a whole life insurance policy
A number of term life insurance contracts include the option of converting to whole life insurance before the term expires. You may be required to convert the insurance long before the term ends.
It’s never too late to purchase life insurance, even at 62. If you think you need to leave your loved ones money to rely on. You can go for it.
However, in certain cases, once you reach your 60s or 70s, you may find that you no longer need life insurance. It's possible that decreasing the expenditure may offer your budget some breathing space. Before making any important decisions, consult with an insurance agent or a financial expert.