Are you reassessing your finances now that life is starting to slow down? In your 50s and 60s (and beyond), life insurance may seem like an unnecessary extra expense – especially with premiums getting higher as you get older.
But the fact of the matter is, no matter how old you are, life is always going to be unpredictable. Whether you’re 20 or 60, there’s no way of knowing what’s going to happen and the best you can ever do is be properly prepared for the unexpected.
If you have a family that you don’t want to burden with debt, a partner who depends on you, or a legacy that you want to leave behind, it’s important to take steps to secure their future and their livelihood. And life insurance is designed to do exactly that.
There are life insurance options available for every stage of your life, including as you move towards retirement. If you’re between 50 and 75, you’re eligible for senior’s life insurance – a tailored insurance product for those in their older years, who have very different needs and motivations to the younger generation of Australians.
Still not convinced? Read on below to weigh up all the benefits!
The Benefits at a Glance
Financial protection is more important than ever as you get older. Not just for the family and loved ones that you’ll one day leave behind, but also for the assets and investments that you’ve worked so hard your whole life to accumulate.
Here’s why baby boomers should be taking out (and keeping) their life cover:
Your circumstances can still change
Perhaps your children are grown and financially independent now, but that doesn’t mean they always will be. Things can change; they could lose their jobs, go back to study, or have to move back home for a while and need your support. Plus, if grandchildren come along, that’s just another reason to have a solid protection plan in place!
Life insurance is not just for when you have dependents. You never know when life will throw a curveball your way, and being able to provide your loved ones with something to fall back on when that happens is the greatest legacy you can leave.
Your debts won’t go away after you die
If you’re still paying off a mortgage, credit card debts or other investments, these will simply pass on to your spouse or family after you’re gone, leaving them with the burden of continuing to meet payments on top of their own debts and expenses.
Having an adequate life insurance policy means they’ll receive enough to manage those debts without having to use their own savings or sell your valuable assets, taking a lot of the stress and pressure off them in an already very difficult time of adjusting to life without you.
Your family can maintain a comfortable lifestyle without touching your estate
Leaving your loved ones with enough money to preserve their lifestyle will be a significant weight off their shoulders when it comes to meeting their ongoing financial requirements. Even if you’re retired and no longer earning an income, your spouse will still need to pay bills, mortgage (if you have one) and daily living expenses.
But with enough life insurance, they’ll be able to continue living comfortably without having to sell any assets or investments to make payments.
You can leave an adequate inheritance to your loved ones
If you have valuable investments that you intend to leave to your family and loved ones after you’re gone, it’s important to have an adequate life insurance plan in place to prevent that inheritance from being touched to meet debts or other upfront expenses.
Senior’s life insurance allows you to plan for a comfortable retirement and leave behind the legacy you want to be remembered by.
Securing the Best Value Cover
Are you concerned about the cost of senior’s life insurance? While you can’t avoid premiums getting higher as you get older, there are still plenty of ways that you can cut the cost of your policy and make it more affordable on your budget.
Don’t buy too much
Your life insurance needs will change as you age. Typically, you’ll need less insurance the older you get because of fewer financial obligations and dependents. To avoid overbuying, find out beforehand exactly how much you’ll need – an independent insurance adviser will be able to give you an accurate evaluation.
In the same vein, if you’re a pensioner on a limited fixed income with a current policy, it’s always better to reduce your amount of cover than cancel it altogether.
Look for group plans
If you’re still working, you might be eligible to join a group plan offered by your employer. And if you’re not working, there are a number of community groups that also offer group life insurance plans for seniors.
These sorts of plans pass on savings from group discounts, so do some research and ask around to find out if you can take out a discounted senior’s policy.
Ask about discounts
Similarly, ask your insurance adviser or provider about any discounts you may be eligible for. Some plans will give you a discount on your premiums if your partner or spouse also takes out cover, or if you pay your premiums annually.
A lot of insurance providers won’t offer these sorts of discounts upfront, so going through an experienced adviser is your best bet for securing more affordable cover.
Shop around
Every insurance provider is different in the way they price senior’s life insurance and the underwriting involved, which means some providers will have much more competitively priced options for your age group.
Get the best value cover by getting quotes from as many providers as possible, or talking to an adviser who can match you up with the best policy for your needs and budget.
Consider using your super fund to pay your premiums
This is a great way of reducing the pressure on your day to day living expenses, as your premiums are paid out of your super account balance instead of your income.
There are, however, positives and negatives to this approach, so make sure you talk to an expert about your situation first to make sure it’s the right option for you at this stage in your life.
What if my Application is Refused?
Unfortunately, as you get older you become a higher risk for insurance providers, and there is a chance that your application may be refused. This can be because of a number of reasons, such as your health or any existing medical conditions, a dangerous occupation, and whether or not you smoke.
If this happens, it’s important not to be discouraged because there are still options available to you. You can apply with a different provider, or request a reassessment of your application where you may be required to provide additional information.
Going through an independent insurance adviser is also a great way to make sure you’re aware of all your options and are guided through the application process with the best chance of a favourable outcome.
Financial Security for Every Stage of Your Life
Life insurance is not just for the young. No matter what stage of your life you’re in, being properly protected and securing your family’s future is an invaluable asset to have.
If you’re over 50, life cover is more important than ever. Life may be slowing down, but your financial obligations will still be there – take the necessary steps to protect your family and investments today.