Life Insurance for Senior Citizens

Can Senior Citizens Buy Life Insurance?

Yes, senior citizens can buy life insurance because it is a financial safeguard for their loved ones and dependents in the event of their unfortunate demise. The features and benefits of life insurance for senior citizens closely resemble those of plans acquired at a younger age. Additionally, individuals can also procure a term insurance policy for senior citizens on behalf of their elderly parents, ensuring financial protection for family members and availing Section 80C tax benefits.

Why Do Senior Citizens Need Life Insurance?

There are several reasons why senior citizens feel the need for life insurance plans. However, one of the main reasons is that these plans can replace their income to support them and their loved ones financially. Because after getting retired, the money inflow stops suddenly. Here are some more benefits of life insurance for senior citizens:  

• In case of a senior citizen’s death, the children and spouse may suffer greatly because of a lack of money. So, insurance plans are essential to avoid financial problems as they act as a medium for savings and an income source at the end of the policy term.

• The payment received from these life insurance plans can be used to pay off loans or debts such as medical expenditures, outstanding loans, etc.

• To address potential expenses that may arise for the senior citizen’s family after their unfortunate demise, such as funeral costs, buying life insurance becomes crucial.

• If a senior citizen remains a financial contributor to the family, having term insurance for senior citizens ensures that family members are financially compensated for income loss resulting from the policyholder's demise.

What Are The Top 5 Reasons To Buy Life Insurance For Senior Citizens?

Here is a list of the top 5 reasons to buy life insurance for senior citizens:

• These policies provide financial freedom by providing a steady flow of income even after retirement

• With life insurance, you can secure a large amount as an inheritance for your kids

• Your family can use the payout from the life insurance policy to pay off any pending or ongoing debts, medical expenses, education expenses, etc., as per the nominee's or dependent family member's needs.

• In your absence, the life insurance policy will provide financial benefits to your spouse, who might be unable to care for themselves.

• The funds from the policy may be used to pay the applicable taxes on property or any legal fees your family may face.

What Are The Details Of Life Insurance For Senior Citizens?

Here are all the details of life insurance for senior citizens:

• Age Limit: While the entry age for a term plan is 18 years, and it is suggested to buy life insurance early in life, most life insurers in India permit senior citizens up to 65. Therefore, if the policyholder passes away before 85, the insurer pays the sum assured to the nominee.

• Death Benefit: Term plans, among all life insurance plans, provide pure protection. So, if the policyholder (senior citizen) dies during the policy term, the insurer pays the sum assured as the death benefit to the beneficiary/nominee, which thereby, helps them to maintain their lifestyle in the future.

• Premium Payable: The benefit of any life insurance policy remains in effect until it matures, provided all due policy premiums are paid. Though term plans are affordable, the premium increases with the policyholder's age at the time of purchase. Prospective policyholders can determine the premium for their senior citizen term plans using the online term plan calculator.

• Medical Test: When purchasing senior citizen term plans, the policyholder undergoes a medical test to disclose pre-existing conditions like diabetes or cardiovascular disorders, impacting the premium payable.

• Add-on Covers: Term plans, including those for senior citizens, offer optional add-on riders that can enhance the coverage and cover certain extra risks. This includes accidental death benefit, waiver of future premium, return of premium, terminal illness cover, etc. These add-ons are not mandatory and can be availed based on the policyholder's unique requirements. However, they can only be added during the purchase process of the life insurance policy.

*Note: Terminal illness meaning – A kind of fatal disease that cannot be cured and is likely to lead to death.

Characteristics of Life Insurance For Senior Citizens

Let us see some of the characteristics of life insurance for senior citizens

• Senior citizen life insurance offers a variety of payout options like a lump sum, lump sum with income, or regular income to your needs.

• The entry age for such plans differs for different insurance companies.

• You can receive the annuity monthly, quarterly, bi-annual, or annual to replace your regular income post-retirement.

• These plans offer tax benefits under Section 80CCC of the Income Tax Act of 1961.

Different Types of Life Insurance For Senior Citizens in India

The different types of life insurance for senior citizens in India are as follows:

1. Term Life Insurance

   Term insurance plans for senior citizens provide coverage for a specific time. Under this plan, the coverage ends with the policy term. These plans payout the death benefit in case of the policyholder’s untimely death during the policy term. These pure risk protection plans are the most affordable life insurance for senior citizens in India. With term insurance for senior citizens, you can choose the desired policy term, life cover, premium payment frequency, and enhance the coverage by adding riders to the base plan and also increase the sum assured at different life stages. Before buying term insurance for senior citizens, you should always consider comparing life insurance quotes and choose the plan with the most affordable premiums and coverage. 

2. Whole Life Insurance 

   Term life insurance for senior citizens provide coverage for a specific time. Under this plan, the coverage ends with the policy term. These plans payout the death benefit in case of the policyholder’s untimely death during the policy term. These pure risk protection plans are the most affordable life insurance for senior citizens in India. With term insurance for senior citizens, you can choose the desired policy term, life cover, premium payment frequency, and enhance the coverage by adding riders to the base plan and also increase the sum assured at different life stages. Before buying term insurance for senior citizens, you should always consider comparing life insurance quotes and choose the plan with the most affordable premiums and coverage.

3. Retirement/Pension Plans

   Retirement or pension plans allow policyholders to save for their retirement and ensure a steady flow of income after the end of their monthly salary. You can choose an immediate annuity plan that offers a pension or annuities immediately after purchasing the plan, which allows senior citizens to live a financially independent life even after retirement. The income these plans provide can help the policyholder live a comfortable life and ensure the spouse receives the income in case of the policyholder’s death.

Best Life Insurance Policy for Senior Citizens in India 2024

Let us take a look at some of the best life insurance for senior citizens available in India in the year 2024:

This is a list of the best term insurance plans for a 65-year-old, non-smoking male, with annual income of Rs. 10 Lakhs.

Note: You can also use a life insurance premium calculator to compute the premium amount you have to pay for your desired life cover.

How To Buy Life Insurance For Senior Citizens In India?

You can follow the steps below to buy suitable life insurance for senior citizens as per your needs.

• Step 1: Go to Policybazaar’s Life Insurance for Senior Citizens page

• Step 2: Enter your basic details like name, gender, phone number, and email address

• Step 3: Click on ‘View Plans’ to browse the available plans

• Step 4: Fill in accurate information regarding your smoking habits, occupation type, annual income, and educational background

• Step 5: Select the most suitable senior citizen life insurance plan and proceed to pay

Points to Remember About the Senior Citizen Life Insurance Premium Rates

• The premium rates increase with the increase in age. Therefore it is suggested to buy life insurance for senior citizens as early as possible to enjoy the benefits for a longer tenure.

• You can get senior citizens term insurance at affordable premium rates by maintaining a healthy lifestyle and carefully comparing the plan online before purchasing the one most suitable for your needs.

• The premium rates are also dependent on family history and medical background. You may be asked to take a medical exam before buying the plan.

Final Word

Many insurance companies provide life insurance for senior citizens, which are plans for people who are 50 years old or above. Few insurers offer customized plans to senior citizens who are 65 years or above. The maturity age of a life insurance policy for senior citizens with various companies can go up to 99/100 years. This insurance policy aspect allows many individuals to buy a senior citizen's life insurance even if they have never purchased a plan.

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