Taking out life insurance is recommended as soon as you become an adult, but it’s even more crucial when you have people depending on your income for survival. Irrespective of your age, this post will assist you in deciding whether it’s time to apply for the policy or not. Before that though, here are the key takeaways to take note of:
- Purchasing life insurance early when you’re young is cheaper than during later years
- A life insurance policy is suitable when you have dependents or in debt or servicing a mortgage
Is there an age limit for taking out life insurance?
Insurance providers can offer you some form of life cover unless you’re 84 or older. Usually, the primary basis of qualifying is not about age but rather about your current medical condition. Nevertheless, anyone below 18 is legally unfit to enter into any financial contract, and an insurance policy is such.
Does age affect the cost of life insurance?
Yes, your age affects the amount you pay in premiums. Generally, the older you are, the higher the risk of passing away, and that’s a significant concern to your insurer. Even then, the provider will still factor in other events in your lifestyle and status to determine the cost of your life insurance policy.
What if I’m already old and didn’t buy a life insurance policy when I was younger?
Well, that doesn’t mean you won’t find a suitable cover unless you’re older than 84 years. The provider will offer you a list of appropriate options along with the cost of each for you to choose from.
If you’re young, you can benefit immensely from the cash value growth, which is particularly common with permanent life insurance policies. The idea here is that you have sufficient time to build the claim amount of your cover. Moreover, you’ll pay lower premiums compared to an older individual with a potentially higher risk of developing health problems.
How to decide when to get a life insurance cover
Worth noting is that these factors count regardless of your age:
When you have people depending on you
Do you have anyone depending on your income to live comfortably? This may include your ageing parents, children, wife, or other people who rely on your income for support. Life insurance offers a cover for their financial needs and survival when you’re no longer around to take care of them.
Debt levels
Do you have an unpaid debt that can potentially cripple your loved ones if you were to pass away today? Some debts are never written off even upon your death, for example, credit card balance. There’s a chance that your creditors will take over your property to repay themselves, yet you have people depending on it for shelter or source of income. Life insurance can step in to clear these financial burdens and secure the future of your loved ones. For more information on how this works, consult with a life insurance lawyer.
Value over your money
Did you know that you can accumulate significant cash value with a permanent life insurance plan? Making contributions from an early age to this kind of policy increases your cash value in the future.
Your beneficiaries can then claim the returns and sustain their living standards even after you are gone. For example, your children can use these payments to invest and build a future. In some cases, you can use these benefits to supplement your retirement income and live happily in your old age.
The insurer’s policy on age groups
As we mentioned earlier, life insurance providers charge you higher premiums if you take out a cover later in life. It’s essential to find out the rates that your insurer charges for each age group. This information will help you to budget early enough and decide if the premium payments are sustainable in the long run.
What if I cannot qualify for the whole of life or term life insurance?
Insurance providers consider a handful of factors when giving you a life insurance cover, chief among them being your medical history, age and lifestyle. Depending on your current state, a company could deem you unfit for the common covers such as the whole of life or term life insurance. In such situations, you may consider going for the over 50’s insurance or other covers that do not require physical or medical examinations.
At what age do you plan to take out your life insurance policy and why? Please share your feedback with us in the comments below.
