Life Insurance for People Over 50

People over the age of 50 need life insurance for many reasons. Even after the age of 65, life insurance might still be necessary to offset medical expenses, long term care, a mortgage, business loan, or supplement a retirement plan proving insufficient.

One questions pertaining to life insurance for people over age 50 we recieve often is,

Does Life Insurance Make Sense for People Over 50?

Absolutely. The bottom line is that if you have people dependent upon your income in any way or you have any type of debt remaining, life insurance is a necessity.

Here are some reasons why life insurance for people over age 50 is still important:

1. Provides financial support to loved ones

You work hard for those you love but can they pay for debt, expenses, a mortgage, college, or the care of younger children without you?

2. Leaves your legacy behind

Life insurance can be used to pay any taxes that your beneficiaries have to pay for your estate. Any remaining amount can be put toward a cause or charity you like.

3. Create another income source

You might have large expenses in life that eat away at your savings over time. Your retirement might not stretch as far as you like.

So, with permanent life insurance plans, you can accumulate cash value and then use that cash as extra retirement income if needed.

4. Money in the event you are sick

No one ever anticipates a chronic or terminal illness as they age. The cost of medical bills and treatment for terminal illness can be debilitating in and of itself.

Permanent life insurance plans allow you to add riders like accelerated death benefits so that you can cash out a percentage of your life insurance and use it to pay off the medical costs before your passing.

5. Pay reduced taxes

Term and life insurance policies give your beneficiaries a tax-free death benefit upon your passing.

What are the best life insurance options for people over 50?

Well, that depends on your needs. Let’s take some time to review some of the more common types of life insurance, and explain who they are right for.

Permanent Life Insurance vs. Term Life Insurance

Term Life Insurance for People Over 50

Term life insurance policies are typically for shorter term needs and they are offered for 30 years or less.

If you have two kids in college and you are contributing to their education, then a ten year policy would give money for the continued education if you were to pass away, as well as provide income short term to a spouse, pay any remaining debts on a mortgage, and handle funeral costs.

Term policies provide guaranteed death benefits for specific amounts of time and during that time, the rates do not go up, so your premiums remain the same.

With a term life insurance policy you can:
  • Purchase a 20 year policy if you have a 20 year mortgage to make sure your family can pay it off in the event something happens
  • Get a term policy to cover the years you are paying for your children and their education
  • Get a policy adequate to pay off a business loan you do not want your spouse to end up with
  • Get a term policy in case you are a small business owner and want protection should your partner pass away

Permanent Life Insurance for People Over 50

Permanent life insurance plans are for needs that might last indefinitely. A spouse or child who is dependent upon you, a mentally challenged child who needs in-home care regularly, parents who are in a nursing home that you pay for, all these things need permanent financial coverage.

Permanent life insurance plans are ideal for coverage that has no end point. These give you beneficiaries a tax-free sum of money upon your passing.

Family can: You can:
  • Replace income
  • Create additional retirement income
  • Pay final bills or expenses
  • Access money if you have unexpected needs or illness
  • Stay in your house, paying off the mortgage
  • Tax-free loans if you need them
  • Keep plans for future in tact

Each time you make a premium payment toward your permanent policy, a portion of that covers the cost of insurance and any applicable fees. The remainder funds your cash value account. From the very first day, you start getting cash value that accumulates growth which is tax deferred.

That growth potential is different continent upon the type of permanent policy you get. For example: a Variable Universal Life policy accumulates growth based on how an underlying investment is performing. Consequently, certain permanent policies also have the risk of being reduced in value because of how poorly an underlying investment performs.

Whole Life Insurance vs. Permanent Life Insurance

Whole life insurance is basic coverage. So long as you pay your premiums on time, you are covered. The policy then continues to build cash value.

It is a form of permanent coverage and with it, your premiums could increase with age depending on the type and the company you use. Types of permanent life insurance include:

  • Universal life insurance
  • Whole life insurance
  • Indexed universal life insurance
  • Survivorship or second to die insurance
  • Variable universal life insurance

Below is a chart that better explains what you get from different plans:

Term Life Insurance Universal Life Insurance Indexed Universal Life Insurance Survivorship Universal Life Insurance Variable Universal Life Insurance
Temporary Coverage
Permanent Coverage
Provides Guaranteed Death Benefits
Focuses on Better Cost
Offers Coverage for the Rest of Your Life
Covers Two Benefits with One Policy
Can Build Cash Value
Provides Growth Based on Performance of Index
Provides Growth Based on Market Performance
Has a Tax-Advantage Death Benefit
Allows you to Access Money in Your Policy
Custom Riders Available

Now that we have an idea of the types of life insurance coverage for seniors, let’s take a deeper look into how much life insurance costs for people over 50.

Life Insurance Rates for People Over 50

There are many things that influence your life insurance rates, ranging from your age, gender, and health. Some companies take into consideration your job and any sports you do. Those with riskier jobs, lifestyles, exercise, or older ages are offered higher premiums. So, what does the difference in cost look like?

Term Life Insurance Rates for People Over 50

This sample is for a 10 year term life insurance policy, for a male with monthly premiums, based on different coverage amounts.

Age $100,000 $200,000 $300,000 $400,000
50 years old 14.15 25.43 28.56 37.75
51 years old 15.06 27.19 31.43 40.92
52 years old 16.05 29.30 34.57 44.79
53 years old 17.13 31.59 38.00 49.37
54 years old 18.31 34.41 41.75 55.65
55 years old 19.60 38.63 45.83 60.28
56 years old 21.01 40.74 49.94 65.91
57 years old 22.54 44.44 54.40 71.90
58 years old 24.20 48.66 59.23 78.98
59 years old 26.28 52.56 65.29 87.06

Now, the coverage amount you get should be based on your needs, which change as you get older. Consider the chart below for income replacement factors:

Age Bracket Income Multiples
Up to 40 30x
41-50 20x
51-60 15x
61-65 10x
66 and over 6x

So, your age should play a role in determining how much coverage you need, based on the simple math that as you get older, you have paid off more debts, paid off more of a mortgage, and have fewer dependents.

How to Get Life Insurance for People Age 50-55

If you are over the age of 50, the process of getting life insurance is the same as any other age. You should start by applying to multiple companies. Look over their financial stability, their target plans, and compare that to what your needs are. Remember that everyone is different.

You might have had a term policy expire and now are 55 and need a new plan. This might be the time to consider bids from permanent policies.

Conversely, you might be 55 without any previous coverage, and trying to make sure you have enough money to cover the remaining care of your single child who is still in college.

In any case, use a broker to help find a more precise list of companies, offerings, and costs based on your age, state of residence, and health. At this point, contact agents who work directly for the companies to get more precise information from those you are most interested in.

These agents will review your application and then contact you over the phone to follow up with an interview. Depending on the coverage you seek, you will likely have to schedule a medical exam, but typically this is at no cost to yourself and can be scheduled a few weeks in advance.

The Best Life Insurance Companies for People Over 50

Protective Life Insurance for Seniors

Protective is a great company. They specialize in longer terms for older individuals and plans for those with different health concerns.

Protective Term Life Insurance
Pros This is a good solution for those who want an inexpensive policy. Coverage can be 10, 15, 20, 25, and 30 year term limits. The death benefit is guaranteed, and your premiums are the same.
Cons If you are 52 or older, you can get any plan.

If you are 55 or older, you can only get 25 year term plans or less.

AIG Life Insurance for Seniors

AIG Term Life Insurance
Pros You will find a wide range of products.

They offer competitive pricing

Cons They have complex Indexed Universal Life policies.

There are no simplified products.

Banner Life Insurance for Seniors

Banner Life Insurance
Pros There are many riders available.

The term policies are very affordable especially for older applicants.

They are known for their superior underwriting.  

Cons There is no “instant issue” option.

They have no whole life insurance plans.

Tips for Getting Life Insurance Over Age 50

1. Apply for Life Insurance as Young as You Can

So, naturally the first tip to getting better rates between 50 and 55 is to apply when you are younger. The younger you are, the better your premiums.

2. Stay Healthy

The healthier you are, the better your premiums. If you can, take time to reduce your cholesterol and blood pressure. Regular exercise and a slight change in diet can go a long way to improving the results of your medical exam.

3. Avoid Medications When/If Possible

Avoid any dependence upon medication. This will bode well for your long term premiums.

4. Make Sure You Get the Right Amount of Life Insurance Coverage

Only pay for the coverage you need. The amount of coverage required is going to vary based on your individual needs. Someone who is 50 and has 2 kids still living at home is going to need more coverage than someone who is 50 without any kids and a spouse who works full time with their own retirement and life insurance.

Getting the Best Life Insurance for Seniors Over 50

When it comes to a large investment like life insurance, you want to be sure that you weigh all of your options before making a decision that could govern your family’s financial life in the future.

The best way to be sure that you are getting the best life insurance for people over 50 is to work with an independent life insurance agent who can compare life insurance rates and policies from dozens of the best life insurance providers for seniors at once.

Our independent agents are ready and willing to take the time to understand your specific situation and recommend life insurance policies based on your family’s needs.

Give us a call today to work with an agent, or use our online wuoting engine to get instant life insurance quotes for seniors!

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Spectrum Insurance Group is made up of life insurance agents who are licensed in all 50 states and the District of Columbia. Spectrum Insurance Group has helped 1000’s of consumers purchase life insurance online & over the phone.

All content on this site has been written by life insurance experts & licensed life insurance agents.