Those seniors who were on fixed retirement incomes experienced a sudden drop in monthly retirement income as accounts that were earning significant interest began dropping because of market volatility. Many were forced to cash in insurance policies they had paid into religiously and use the cash to make ends meet until the market returned to some type of normalcy. Now, however, those very same seniors that surrendered or took out policy loans find themselves in the position of purchasing life insurance after having aged and developing health issues. Can you buy burial insurance for seniors over 80? Yes, you can, and it’s easier than you think.
Table of Contents
The Rising cost of Funerals
If you are like most seniors, the last thing you want to do is leave a debt to your surviving loved ones. The cost of a funeral, memorial service, and burial has increased steadily over the last twenty years just like everything else. This increase in costs can be attributed to various factors such as increased cost of labor, increased prices for burial plots, and increased costs in utilities that funeral homes and churches face just like other businesses.
According to Parting, an organization that provides information about the cost of funerals and associated services, a moderately priced funeral currently costs about $8,000 and this amount does not include the cost of a cemetery plot. They also are publishing that these costs are projected to increase about 25 to 50 percent over the next ten years. This means that if you purchase just enough life insurance to cover final expenses today, it will likely fall short of covering those same costs if you should die ten years down the road. This could result in a burden on your surviving loved ones who will likely have to save as much money as possible on your funeral arrangements.
Guaranteed Issue Burial Insurance for Seniors
There is good news for seniors with health issues looking for life insurance. There are many companies in the marketplace who will offer traditional life insurance for seniors up to age 85 if they are in good health. There are also many insurers that will offer guaranteed issue life insurance up to age 85, and a few that will go as high as 90.
- Traditional Life Insurance for Seniors who are 80+
Simply put, traditional life insurance is typically fully underwritten, and if the applicant is found to not have any major health issues, a policy can be issued at very reasonable rates. Seniors need to understand that life insurance rates are most affected by your age and your health condition. These policies typically require the applicant to provide detailed health information and to undergo an insurance medical exam
If the applicant’s health condition does not include major health issues or any minor issues are under control, the applicant will likely be rewarded with very affordable rates. If, however, the applicant has multiple health issues or any major health issues, they will need to apply with an insurer that offers guaranteed issue life insurance.
- Guaranteed Issue Life Insurance for Seniors who are 80+
Seniors, who are unable to qualify for traditional life insurance because of health issues, still have the option of purchasing guaranteed issue life insurance. These policies are typically issued automatically without regard to health issues. There are, however, a few caveats that you must consider and agree to.
1. Typically, the maximum death benefit allowed for guaranteed issue life insurance is $25,000 and may be reduced for applicants over the age of 80.
2. Guaranteed issue policies also contain a waiting period of two or three years where they will not pay the full death benefit if you die from natural causes. Typically, the death benefit will be reduced to the total amount of premium you’ve paid into the policy plus an additional 5 or 10 percent of that amount. Many policies, however, will pay the full benefit from day one as long as the death of the insured was caused by an accident.
3. Since the life insurance company has agreed to accept an unknown health risk, the insurer will charge a considerably higher premium than you would get in a traditional life insurance policy.
Insurers who offer Burial Insurance for Seniors over 80
If you are over 80 and have no life insurance or not enough life insurance, there are some companies available that will issue a policy for you under the right conditions allowing you to buy burial insurance for seniors over 80.
- American General Life Insurance: The guaranteed issued policy offered by American General does not require any medical underwriting or medical tests, is available with a death benefit of up to $25,000, and applicants up to 85 years old are eligible for coverage.
- United of Omaha Life Insurance Company: United of Omaha, a subsidiary of Mutual of Omaha, offers guaranteed issue whole life coverage for applicants aged 45 – 85 years old. There are no medical exams, and coverage remains in force for a lifetime as long as the periodic premiums are paid.
- American Amicable Life Insurance: Although American Amicable does consider health history as part of the underwriting process, the company will issue a whole life insurance policy for applicants up to 85 depending on your state of residence. The policy is a standard life insurance policy and contains all the benefits of whole life insurance.
- Security National Life Insurance: Security National is a highly rated life insurer that offers Final Expense (burial insurance) for applicants over age 80. The policies are issued as whole life with lifetime guaranteed coverage as long as the periodic premiums are paid.
Getting Started for Burial Insurance for Seniors over 80
Doug Mitchell, President of Ogletree Financial, holds a BA degree in Finance from Auburn University as well as having obtained a Chartered Life Underwriter (CLU) designation from The American College in Bryn Mahr, PA. Doug has spent over 20 years in the life insurance industry and has also held licenses to sell securities, long-term care insurance, and home and auto insurance. For two years, Doug served as President of the Auburn Opelika Association of Financial Advisors and has been a member of the Million Dollar Round Table. He obtained Life Millionaire status at Horace Mann Insurance Company and was awarded the Life Agent of the Year Award. Later in his career with New York Life, he was an Executive Council Member. Doug currently serves as President of Ogletree Financial, a life insurance marketing organization with over 1000 life insurance agents. Today, Doug’s main focus is servicing 1000s of policyholders and growing his agency through the reach of several insurance-related websites.