Can You Find Term Life at 55?
When we think of term life insurance, we usually think of the needs of younger families in their 30s or early 40s. They need to make sure that survivors can stay in their home, have money to pay debts, and can finance educations if one of the parents passes away. In theory, by the time those parents reach their 50s or 60s, those obligations should be smaller, the mortgage should be paid off, and savings will be larger.
However, we have all seen cases where this did not work out the way we thought it would. Mortgages did not get paid off on time, perhaps because they were refinanced to survive a period of unemployment, or a second mortgage got taken out to finance a college education. Savings did not grow as planned, perhaps because investment value declined in the stock market. And the kids, who were on track to be finished with their educations and self supporting by now, did not stay on the schedule.
So now, many middle aged people find that their term life insurance policy has expired, and they still need the high amounts of coverage and affordable premiums that term coverage can provide! But the news is good. Life insurance rates are actually declining, and insurers are more willing to offer 10 or 20 year term policies to middle aged people.
The reason that term policies for older people get issued now is because statistics show that people are living longer and healthier lives. Workers are also pushing back retirement well beyond the traditional age of 65. Insurers realize they can issue their products to a whole new market, and that the people in this market still need their coverage.
Now, a 55 or 60 year old probably cannot expect to find a 30 year term policy, but they can find 10 or 20 year terms. And if they are in reasonably good health, and maintian good health habits like not smoking and keeping their weight in line, the prices are very low. Even with some health challenges or bad habits, prices are still affordable.
We cannot quote exact rates since those premiums vary by age, heealth, location, and the insurance company. However, it is common to find 20 year term policies for a couple of hundred thousand dollars, being sold to 55 year old non-smoking women for under $50 a month. Men are almost always a bit more expensive to insure, but given a comparable situation, they should find premiums well under $100 a month.
Smokers, and those with health challenges, can still find affordable rates, and may consider a small face value or a 10 year term to keep premiums lower. Of course, smokers and overweight people would do well to address those health habits for lots of reasons, but also because they can get cheaper life insurance!
If you are middle aged, or even in early retirement years, do not hesitate to look for term policies if you need larger amounts of coverage at affordable rates!