Life Insurance for Aging Parents
Life Insurance for Aging Parents
As you get older, so don’t your parents, and even though their financial obligations may have changed over the years, they should still have life insurance in place so that their loved-ones are left behind financially secure, and not burdened with expenses.
If your parents need to get life insurance in place but are unsure what type of policy will suit their needs, continue reading below for the answers.
Life Insurance Options
The type of life insurance policy your parents should consider depends on a couple of factors such as their age, their health and their financial situation. Those will determine what types of policies are available and which one will best suit their needs.
If your parents still have dependents that rely on their income and have a significant debt due to things like a home mortgage, credit card debt and college expenses, than term life insurance is a good solution.
Term life insurance offers the most death benefit protection at the lowest cost. In addition, the premium stays the same during the entire course of the term and contract. If the insured parent passes away during the contract term, the beneficiary will receive the death benefit that was guaranteed.
If you parents are in their 50’s, term insurance is still very affordable if they are physically and financially fit and there is still a good chance they will get approved quickly without needing a medical exam or lab test.
If your parents have a more flexible budget and want to be able to leave legacy money to their loved-ones, then whole life insurance should be considered. Premiums for whole life are more expensive than term but that is because not only does it provide lifetime protection, a portion of each premium you pay goes into an account called “cash value” that grows on a tax-deferred basis. That cash value can also be used later on during retirement as a way to supplement some income if that is also something your parents are looking for.
For parents that are older and for those whose health is more compromised, they may want to consider a final expense whole life insurance policy to help to cover any remaining expenses left behind should they pass away.
There are no medical exams or health questions when applying for final expense whole life insurance. These policies provide lifetime protection with premiums that never change and can’t be cancelled because of your age.
Final expense whole life Insurance is used to cover things like medical expenses or the ever increasing funeral or burial costs so that your family is not left behind with that burden. Sometimes, it’s also used as a way to leave gifts or a small legacy to grandchildren.
Buying Tips to Consider
With more Americans buying life insurance because of the pandemic, it is crucial to buy from a trusted insurance provider. There are rating agencies, like AM Best, that provide financial strength scores for insurance companies that you should review so you can feel confident about the company you are buying your life insurance from.
If it is your intention to buy life insurance for your parents, make sure you talk to them first and get their consent to purchase. Never do it in secret. In most cases you will need them to sign the application. As the owner of your parent’s life insurance policy, there needs to be an insurable interest between you. What that means is that there would be a financial impact from the death of your parent. However, when it comes to family members that is almost always the case.
Getting the Right Insurance for Your Parents
By understanding the different types of life insurance options, you can help your parents choose the one that best suits their needs. You can maximize its benefits while providing the best possible coverage.
If you’re searching for the right insurance plan, we can guide you in the right direction.
It’s never too late to get the life insurance protection needed and it’s never been easier. Click here to quote and buy today!
Our content is created for educational purposes only. This material is not intended to provide, and should not be relied on for tax, legal, or investment advice. Vantis Life encourages individuals to seek advice from their own investment or tax advisor or legal counsel.