So your birthday cake might have a few more candles on it now - so what? We are all young at heart, after all. But if you’ve recently hit the big 50, you may have noticed a sudden abundance of over 50s life insurance leaflets, brochures and tv adverts wherever you turn. Is this just a marketing ploy? Or... something you should be considering?

Life insurance, whether specifically for over 50s or not, is all about protecting the ones you love in the sad event that you should pass away. It is a financial safety net that can support them through a very difficult time and ensure that they are not left with any extra financial burdens as a result of your passing. This can be a huge weight off your mind.

We take out insurance to protect our physical assets all the time - our phones, laptops, houses and cars - without giving it too much thought. Life insurance, however is, in our humble opinion, something extra special, because it is about protecting the most important thing of all: the people we love. 

So, in short. Yes, all of the leaflets and adverts, jingles and billboards are clever marketing, and admittedly maybe a slightly annoying reminder of our age, but there’s never been a better time to finally think about getting your life insurance sorted. 

This guide will explain what over 50s life insurance is and help you decide whether it might be the right fit for you and your family.

How does over 50s life insurance work?

Over 50s life insurance is (you got it!) life insurance designed for people who are over the age of 50. But while it is very similar to some other types of life insurance, there are some key differences, which we will outline in this guide.

Briefly, this is how it works. You pay a monthly or annual fee called a ‘premium’ and then, when you pass away, your policy will pay out a lump sum of tax free money to your loved ones. You can take out an over 50s policy if you’re aged between 50 and 80 and are a UK resident.

Over 50s life insurance is a type of whole of life insurance policy, meaning that it doesn’t expire - no matter what age you die, your loved ones will be guaranteed to receive a payout. The one caveat with over 50s plans is that there’s usually what we call a ‘waiting period’ - a length of time after taking out your policy during which you won’t receive a payout if you die, instead the insurer will usually refund your insurance premiums to you. Waiting periods are typically one year or more. This is different to term life insurance, where there’s no waiting period, but your policy will only cover you for a certain length of time, or ‘term’. This means you could outlive your term life plan (hoorah!), but therefore never receive a payout.

Like any type of life insurance, the payout from an over 50s policy can be used wherever it is most needed; there are no rules about what it can or can’t be spent on. That being said, over 50s life insurance payouts are often used to leave a financial gift to a loved one or to cover the cost of a person’s funeral.

It’s not a nice thing to think about, but the fact is that funerals cost a lot of money. Perhaps more than you think, actually, and unfortunately, the price is on the up. In 2020, the average price of a burial funeral in the uk was £4,383(1). But, when you add in the legal and send off fees, the actual cost of passing away, which sits with those you leave behind, can be over double that - wowza!

Many people choose to take out an over 50s life insurance policy in order to cover these costs, meaning that their loved ones will be able to give them a proper send off without suffering financially as a result.

Should I buy over 50s life insurance?

One of the more unique features of over 50s life insurance cover is that it is ‘guaranteed acceptance’. What does this mean? It means that anyone (over the age of 50, and under the age of 80) can purchase a policy, regardless of their health. Essentially, you don’t have to answer any questions about your health or lifestyle in order to qualify for cover. As a result, it is much quicker and simpler to purchase an over 50s plan compared to more traditional life insurance, which is underwritten - you usually have to answer lots of questions about your health and medical history before being offered a policy. With over 50s plans, it’s simply a case of signing up - easy peasy! So, if you are over 50 and have a health condition, then an over 50s policy could be ideal for you.

Another reason for choosing over 50s life insurance is that, particularly for someone in poorer health, it is an extremely affordable option, with policies starting from as low as £7 a month. 

To put the cherry on top, many insurers also throw in an extra free gift. For example, here at Cavendish, our new Over 50s life insurance comparison service guarantees that at least one of the quotes returned will include a £300 cashback gift. If you’re interested in purchasing an over 50s plan and would like to chat through your options, please give us a call on 03456 442 540.

Term life insurance or over 50s insurance - which is better?

At this point, you’re probably wondering why on earth you shouldn’t invest in an over 50s life insurance plan? But there are some downsides, and, as ever, whether it is the best option for you depends on your individual circumstances. Here we will consider some of the reasons why you might choose to purchase a term life insurance policy instead of an over 50s plan.

The state of your health should play a big role in determining whether you go for an over 50s policy or a term life insurance plan. While it can be a bonus to take out a policy that isn’t strict on the medical terms and conditions, you may pay over the odds for cover if you are in excellent health. 

As we mentioned before, term life insurance means that you are not guaranteed a payout, as you can outlive your policy. This might seem off-putting, compared to a guaranteed payout from an over 50s policy. However, when you take out a term life insurance plan, you choose the length of the term, and some policies cover you up to age 90, so given UK life expectancy is around 80, the likelihood of you receiving a payout is pretty high.

Another thing to consider in your decision is the amount of cover you are likely to need. By that we mean, how big of a payout you need to ensure that no financial burden is passed onto the people you leave behind. Cover levels on over 50s life insurance plans tend to be smaller than those on term life insurance. So, if you only need your life insurance plan to cover your funeral costs, then an over 50s plan could be more than sufficient. However, if you have other outstanding debts, such as a mortgage, that you don’t want to pass on to your loved ones, then the limited cover on offer from an over 50s policy simply may not be enough to meet your insurance needs and you may be better off choosing a term life insurance policy.

How can I buy over 50s life insurance? 

Though over 50s life insurance and term life insurance do differ in many ways, they both have one key, crucial similarity, which is that they are designed to support your loved ones during a time of need.

At Cavendish Online, we offer many options to help you find the best insurance for you and your family. If you know what you need, you can apply for a life insurance policy online yourself, in just a few minutes, or use our new over 50s life insurance comparison service to receive at least one over 50s insurance quote with a £300 cashback gift. 

If you could do with a helping hand, you can choose to speak with one of our specialists over the phone, who can guide you through the process and help you choose the best policy for your personal needs.

Call one of our experts on 03456 442 540 for some support today.

1. https://www.royallondon.com/siteassets/site-docs/media-centre/royal-london-national-funeral-cost-index-2020-funeral-report-web.pdf

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