Life Insurance for seniors over 60

If you’ve turned 60 or more you might be in a very different financial situation than you were in your younger years – potentially with fewer dependents and a smaller mortgage – but life insurance could still be important to you. Let’s find out how seniors’ life insurance works.

Can I get life insurance when I’m aged 60 and over?

Generally speaking, if you’re aged 60 and over you should be able to find a life insurance policy that offers you cover based on your age, provided you meet the other eligibility criteria of the policy.

Most insurers have an upper limit on what age you can be when taking out a new policy. For example, based on the life insurance policies on Canstar’s database, the average entry limit is 67 years old, with the maximum entry age being 73.

But age is just one of the factors that could determine whether an insurance provider will give you life insurance cover. Your health, lifestyle (e.g. whether or not you smoke), occupation and hobbies are other factors that are likely to be considered.

Why would someone who’s aged 60 and over want life insurance?

Depending on your circumstances, life insurance could still be useful for someone who’s aged 60 and over and/or who is retired. For example, you may still have financial commitments, such as a mortgage or personal debts. There’s also the consideration of providing for any children or other relatives who may be  financially dependent on you, or who you care for in some other way.

Some people also consider seniors’ life insurance as a way of ensuring their funeral and other related expenses will be covered when they pass away. A funeral benefit (also called a Funeral Advancement Benefit) is a feature offered by some life insurance policies.

But if your family’s finances are in order, you’ve minimal household debt and you no longer have dependents, you may decide you don’t require any cover.

You may also find that you’re adequately covered for life insurance through your super fund. Keep in mind though that total and permanent disability (TPD) insurance cover in super usually ends at age 65, and life cover usually ends at age 70, according to the Australian Government’s Moneysmart website.

What types of life insurance are seniors eligible for?

When it comes to the types of seniors life insurance available, term life insurance is generally the product with the highest maximum age of entry. Other products such as total and permanent disability (TPD), trauma insurance and income protection insurance typically have lower maximum ages of entry – often around 60 years of age – so they may not be suitable.

For people with an existing policy, the expiry age is generally higher than the maximum entry age.

This can be a factor to consider if you intend to cancel a life insurance policy. You could end up cancelling an existing policy that would continue to provide you with cover were you to remain as a policyholder, but find yourself unable to take out a new policy with another provider due to the lower maximum entry age that typically applies.

What does term life insurance for seniors cover?

Term life insurance (sometimes referred to as ‘death cover’), is what we usually mean when we talk about life insurance.

It provides a lump sum payment to your nominated beneficiaries in the event of terminal illness or death, so could be suitable if you’re looking to provide for your family. This type of policy only provides coverage for a set term, so you’ll need to check the maximum entry age and the expiry age when considering options.

It could also be worth checking out any additional features or add-ons offered, such as a funeral advance benefit (an upfront payout to help cover funeral costs).

How much does life insurance cost when I’m over 60?

There’s no simple answer to how much life insurance costs for seniors as each insurer takes into account different factors when assessing an applicant.

Age, as well as gender, smoking habits, your occupation and medical history can all affect your life insurance premiums. But Canstar research shows a continuous increase in premiums for both men and women as they age.

By the time you reach your 60s, you may find that the premiums for a life insurance policy could be in the hundreds of dollars per month.

How long will life insurance cover last?

An important component of life insurance you’ll need to factor in is your policy’s expiry age, in other words, the age at which the policy will no longer provide you with any cover. That’s the maximum age up to which a claim can be made.

Not all providers on Canstar’s database list an expiry age. But when they do, Canstar Research says every one of them says the expiry age is 99. If you’re eligible for life insurance, that should be enough to cover most people as the average life expectancy of Australians ranges from the mid-70s to mid-80s, depending on when they were born, although a number do make it to their 90s, and a few past 100.

Who has the cheapest life insurance for seniors?

You’d need to shop around a number of providers to see what price they offer you for a new life insurance policy.

But while price may be an important factor to you when choosing a policy, it’s not the only consideration. It’s a good idea to take into account the level of cover provided, any exclusions, and the expiry age of your preferred policy before deciding if it’s right for you.

You’d be wise to check out any product disclosure statement (PDS) or other relevant documents to make sure the policy you’re considering is suitable for your needs. You might also consider seeking some professional independent advice.

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