Getting adequate insurance cover is a very important part of a person’s financial plan to make his or her future secure as well as the future of loved ones, and the objective for buying insurance for the over 50 is also not very different from this. A person buys such products to continue ongoing support to his family, even when he is not around.
A person may not fill the emotional vacuum that his demise will create in the lives of people who loved him or her, but a life insurance plan gives a 50-plus individual confidence that his or her family will not have to suffer financial loss after his or her death.
To help elderly plan the future properly, many insurance company has devised special insurance plan keeping their age and requirement in mind. The over-50 life insurance is that product.
What kind of insurance cover does the over-50 insurance product offers There are two types of policies offered to an over-50 individual – capped or uncapped. You will be given these options to choose from based on the amount you want to be covered for. If you go for a capped option then you will have to pay an agreed premium every month until the amount you want to be insured for is reached.
And in an uncapped over-50 insurance product, you will have to pay premium for rest of your life. The insurance company also asks if you want it to give your family a lump sum amount after your death, and if you want the company to cover your funeral cost as well. Many companies agree to pay 10% extra for funeral costs.
What are the benefits The insurance policy you will buy will help you guarantee that your family will not have to face any hardship once you are not around. It will also help them cover for all the bills that the deceased person left unpaid. The money you will leave behind you with the insurance company will also help them deal with financial hardships they may encounter once you are gone. Isn’t this benefit enough?
If the insured person passes away within 12 months or 24 months (the duration depends on the insurance company) of his buying the policy, the company pays the family 150 per cent of the premiums paid until the demise of the insured person. In the UK, the payout limit for most of the insurance company is £32,000.
Is there any shortcoming Actually there are a few. In the UK, people lives more than average life expectancy of 74.4 years for men and 81.6 years for women, so a 50-plus individual may end up paying more money than he is insured for, if one takes an uncapped insurance policy.
Another drawback relates to the UK tax law. Under the law, the premium that you pay is definitely tax-free, but after your death, when the insured sum is paid to the beneficiary, it is taxable under inheritance tax law.
But there is no escaping these shortcomings, so it is always better to get yourself insured for the better future of your family, whom you would not like to see reeling under any financial burden. Buying insurance for the over 50 is a must, if you have not bought it already.
Simons reviews different insurance products companies and give his opinions about what kind of insurance for the over 50 required.