Over 50s life insurance

The main difference between life insurance and an over 50s plan is how long you’re covered for:  

• A term life insurance policy covers you for a specific time period 

• Over 50s life insurance covers you for the whole of your lifeif you keep making your payment. 

Unlike term life insurance, over 50s life insurance policies offer guaranteed acceptance without medical evidence.

Life insurance is worth thinking about at any age. But with over 50 life insurance, there are no medical questions or checks. Over 50 plans could be suitable if you:  

• Are in poor health, and  

• Don’t expect to live a long life. 

If you have family members you want to leave something to, a life insurance policy is worth considering.

If you miss a payment on your policy – for example, you’re admitted to hospital unexpectedly and forget to pay – it could lapse. This means you:  

• Won’t be covered any more 

• Won’t be refunded any of your previous payments. 

When you first miss a payment, a ‘grace period’ begins. This gives you time to meet your payment before your policy lapses. If you don’t make your payment in time, your policy will be invalid.

Read your documents carefully and make a note of your grace period. If you’re at all unsure, speak to your insurance provider as soon as possible.

You could also think about setting up a direct debit, so you don’t accidentally miss any payments.

Because you pay life insurance over a long period, it’s good to know that you should be protected if your provider goes bust or fails.

Registered life insurance providers should be covered by the Financial Services Compensation Scheme. If a valid claim is made on your policy, you should get a 100% payment if the firm failed on or after 3 July 2015. If before, claims are 90% protected.

The benefit amount is the amount a life insurance policy should pay out when the policyholder dies.

Different life insurance policies have different benefit amounts. When you take out a policy, it’s important to consider the benefit amount versus the monthly premium.

This is especially worth doing if you’ve only just turned 50 and are considering an over 50s life insurance policy. If the policy isn’t claimed on until you’re much older, will you end up paying in more than the policy pays out?

A life insurance qualification or waiting period is the amount of time that needs to pass before you can make a claim after the policy start date. It is usually between 12 and 24 months.

If you die during the qualification period:  

• Your beneficiaries won’t get a payoutbut they might get a refund on the premiums you’ve already made. 

• Some insurance providers will pay out the full cover amount during this time, if your death is accidental. 

Over 50s life insurance policies are fixed. This means that the payout won’t increase to reflect inflation.

So, if you take out a policy at 50 but live to 80, the payout could be worth less in real terms.

If you want to factor inflation into your life cover, you may need to look at life insurance options that offer ‘indexation’ as an add-on. 

Writing a life insurance policy in trust allows you to legally separate your policy pay-out from your estate. Depending on the value of your assets, this could protect it from inheritance tax.

Choose your trustee(s) carefully, though. They’ll be responsible for making sure the payout is used as you intended.

If you already have a life insurance policy you want to put in trust, you can usually arrange this through a solicitor or financial adviser.

Yes, you can get senior life insurance for over 60s and over 70s. It’s essentially whole of life or over 50 life insurance.

• These policies can usually be taken out up to the age of 80 

• Some specialist insurance providers may even offer life insurance cover up to your 85th birthday. 

You can get an over 50 life policy if you’re terminally ill. This is because you don’t need to provide health information when you apply.

But the policy may not pay out if you die before the qualification or waiting period ends. This is typically one or two years after you take out your policy.