Explore Life Insurance

Life can be unpredictable no matter your age; nobody can foresee the future!

A life insurance policy can protect your loved ones from the burden of picking up sudden expenses should the worst happen to you, like death or terminal illness. That is why acquiring a suitable level of cover as a senior can be important.

Even if you’ve built up a nest egg over the years, life insurance gives you peace of mind, knowing your family won’t have to reach into your hard-earned savings to cover any unexpected costs. Many seniors who have reached (or are approaching) retirement seek to safeguard their family’s financial stability through a life insurance policy. We’ll take you through everything you need to know about life insurance for senior Australians.

Can senior Australians and residents take out life insurance?

Life insurance is available to most senior Australian citizens (typically between the ages of 60 and 75), provided they don’t have any serious pre-existing conditions. In some cases, you may be required to take a medical exam or have blood tests during your application, but this is relatively common even when purchasing cover earlier in life. The cost of your premiums depends on various circumstances, such as your current health status, medical history and how much life insurance cover you need.

Both permanent residents and those who are living in Australia without permanent residency may be eligible for life cover; however, there may be different application and procedural assessments, which are dictated by each insurer. Therefore, it’s imperative to check with your life insurer if you’re considering taking out cover. Generally, seniors who are not Australian residents applying for life insurance need to meet the following requirements:

  • You’re from a listed country classified by the federal government (Level 1 or 2).
  • You’ve been living in Australia for at least 12 months (with an intention to stay longer).
  • Your visa status is accepted by the insurer.

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What is the cost of life insurance when you’re a senior?

For seniors, life insurance costs can depend on many factors, such as the life insurance provider and the type of policy you choose. Generally, life insurance premiums tend to get more expensive as you age, but this is not always the case. For example, someone who lives a dangerous or unhealthy lifestyle could end up paying more for their policy than someone who is older.

The underwriting process differs between life insurance companies, so it might be a good idea to compare quotes from multiple insurers to find the best life insurance policy for you.

What options are available for seniors looking at life insurance?

There are several different types of life insurance available. Each type of cover varies in its purpose, conditions, payout type and minimum and maximum age limits. Four of the most common life insurance options are:

Term Life Insurance

A term life insurance policy makes a lump sum payment to your beneficiary in the event of your death. It’s suitable for people wanting to ensure their family is provided for after their death or to cover their medical bills if diagnosed with a terminal illness. A term life insurance policy only covers you for a set period of time (e.g. 30 years or until you turn 80). If you took out life insurance before it was discontinued in 1992, you might be on a whole life insurance policy instead, which covers you for your whole life and accrues a cash value that can often be withdrawn during your lifetime. You can no longer take out a whole life insurance policy, so keep in mind that if you’re switching insurance, you’ll be moving to a different type of cover.

Total Permanent Disablement (TPD) Insurance

TPD pays you a lump sum of money if you’re permanently disabled, which can go towards expenses like treatment and rehabilitation or to compensate for lost income. It can be taken out with your life insurance policy or as a separate policy. Some TPD insurance products will also pay out a death benefit if you die before claiming on the policy.

Trauma Insurance

Also known as critical illness cover, trauma insurance pays a lump sum if you’re diagnosed with a serious medical condition. There are many medical conditions that fit the criteria of a trauma event, including cancer, circulatory diseases and nervous system diseases. Each policy will specify exactly which conditions are covered and the level of severity that needs to be met.

Funeral Insurance

Sometimes called burial insurance or final expense insurance, this type of insurance pays a lump sum that can go towards funeral expenses in the unfortunate event that you pass away. Generally, you don’t require a medical exam to take out this type of insurance, although it usually comes with a lower coverage amount.

Life insurance for people over 50, 65 and 70 years of age

Reaching the half century is a significant milestone in anybody’s life. It’s also a time to think wisely about your savings plans, retirement goals and family’s financial future. You may also want to consider life insurance during this period to ensure your family’s debts are covered should something happen to you.

Australians over 65 years of age have so much to look forward to, like retirement, travel and relaxing. Unfortunately, it’s not all smooth sailing, and over time your health will likely become a big factor in determining where you choose to allocate your resources.

When you’ve matured beyond the age of 70, it becomes time (if you haven’t already) to seriously consider your health status and what you’ll be leaving behind for your family. If you’re considering life insurance, please take the time to read your insurance provider’s Product Disclosure Statement (PDS). Features and benefits, terms and conditions and maximum entry age are all factors you’ll want to consider. If you’re unsure of any clauses in your product, it might be wise to speak to a life insurance expert to discuss your options.

Should you consider life insurance after retirement?

While there is no simple way to answer this question, it’s always wise to consider your circumstances without forgetting about your family’s future and livelihood. If your family’s finances are in order and you’ve taken your household debt into consideration, you may only require a low level of life insurance cover, if you need it at all.

You may want to take out life insurance after retirement for a variety of reasons:

  • Your family are dependent on your financial contributions to pay debts and living expenses.
  • Your children require ongoing financial support due to medical needs or school/university fees.
  • Your spouse or dependents would require financial assistance to cover funeral costs (in the event of your death) or legal fees.
  • You want to give your family an inheritance to invest in their future.

Does your life insurance expire after a certain age?

Another component of life insurance you need to be aware of is your policy’s expiry age. These age limits vary between insurers and policies, but are generally:

  • Term life insurance expires at 99 years of age
  • Total permanent disablement (TPD) insurance expires at 65 years of age
  • Trauma insurance expires at 70 years of age.

These expiry ages are a guide only. It’s important to always read your PDS to find out at what age your cover may become void or change to a different type of cover.

Executive General Manager of Health Life and Energy

Meet our Executive General Manager for Health, Life and Energy, Steven Spicer

Steven Spicer strongly believes all healthy senior Australians should consider life insurance. Steven knows all too well how life insurance can comfort and protect your family should you become terminally ill, permanently disabled or pass away.

Steven’s top tips on life insurance for seniors

  1. The policy you choose may not include everything you require. However, some providers allow you to choose additional features such as funeral insurance, total and permanent disability cover, trauma protection and an accidental death benefit. Consider this when comparing policies.
  2. There are several factors that affect premiums, including your health status, age, gender and medical history. It’s important to be completely honest about all these factors when searching for a life insurance policy to ensure you and your dependents are adequately covered if a claim needs to be made.
  3. When setting a cover amount always consider factors such as your income, health status, assets, any personal savings and the dependents who rely on you. This can help you determine if the cover amount you’ve selected will be sufficient if a claim is made.

Compare your options

We understand that everyone’s circumstances are different, so finding the right life cover for you can be a complicated process, especially as a senior. For that reason, we want to help you find a policy that works for you by offering an easy-to-use online life insurance comparison tool. In just a few minutes, you’ll be able to select a range of features that matter the most to you and compare life insurance quotes from our panel of trusted life insurance providers.

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