Now that you're approaching retirement or you're retired, at this phase of life, you may think you don't need insurance. You've handled most of life's huge financial responsibilities like raising your children, paying their college fees, and perhaps paid off your mortgage. You're probably debt-free with enough savings for you and your significant other to take care of your future needs. This means you're in good financial standing, right?
So, now it's time to focus on taking care of your final expenses, leave a legacy for your loved ones and the causes that you care about. As part of healthy financial planning, preparing ahead of time will ensure your end-of-life wishes are adequately taken care of, exactly the way you’ve envisioned them. So, if you're 65 years or more, life insurance is the best way to take care of your final wishes and it will also provide a safety net when your family needs it the most.
If you currently have a life insurance plan in place, is it adequate enough to achieve all that you wish for? If your current plan isn’t robust enough, you should consider buying additional insurance to stack on to your current plan to enhance your assets. Even if you don't have a life insurance plan yet, it's never too late, now is the best time to invest in one.
Why is Seniors Life Insurance Right for You?
There're so many reasons why you need seniors' life insurance, even if you no longer have huge financial responsibilities. Aside it being used to care for end-of-life expenses, it can be used to diversify your assets, provide financial stability for your spouse, or to take care of expenses for a dependent with a disability, and to settle any other outstanding debts. Here are some reasons you need to invest in a seniors’ life insurance policy.
Final Expenses
Funerals can be a huge expense. Funerals in Alberta can cost up to $12,000. This is why it's crucial to plan ahead and have this expense sorted. Imagine the financial burden your loved ones will bear if they have to pay such an amount out of pocket. With a seniors’ life insurance policy, your final expenses will be taken care of with ease. So, your loved ones won’t bear this huge financial expense, especially in their time of grief.
Final Medical Expenses
As we grow older, we experience more health challenges. Medical expenses due to illness diagnosis in later years and hospice or nursing home care can add up quickly. If you have a seniors’ life insurance plan in place, it will provide a reliable financial source to fund such expenses. This will help you and your family focus on you receiving the best medical treatment rather than worry about where to source medical funds. Paying out of pocket can be a big financial drain on whoever is footing the bills.
Outstanding Debts
If your goal is to pay your outstanding debts, you can choose a term policy that will expire around the time you expect your debts to be paid off. If you have ten years left on your mortgage for example, you might purchase a ten-year term life insurance policy so that in the event you were to pass away before the debt is paid off, your beneficiary could pay the remainder of the mortgage with your insurance payout. The right insurance plan can also take care of other debts like car loans and credit card bills.
Leave a legacy
One of the best ways to ensure your legacy is passed on is through life insurance. Whether it’s in form of inheritance to your children or as a charitable gift to causes or organizations that you care about, you can determine exactly how you want your life insurance proceeds to be disbursed in advance. Because life insurance benefits are paid out tax-free, it ensures that your loved ones receive the exact amount you want them to get. You can also choose a cause that is dear to you, and designate a registered charity as the beneficiary of your life insurance policy so that the full tax-free amount is paid to the charity.
Support Dependents
You can use permanent life insurance to protect people who are dependent on you for financial support after you pass away. The life insurance benefit will provide some financial protection for your loved ones to minimize or eliminate the financial distress they may face as a result of your passing. It will replace your pension income to provide financial support for your spouse or a loved one with a disability or special needs. This will help maintain their current living standards and ensure their quality of care is not compromised.
Diversify Your Assets
If most of your assets are tied up in investments or property, permanent life insurance can serve as another form of asset, to ensure they are not all fixed in one place. The death benefits and cash value of your permeant insurance policies are not correlated with the value of your other assets, and considering tax treatment of life insurance proceeds, the ultimate value of your estate could be enhanced, while reducing your overall risks. The process of life insurance payout is far quicker in comparison to when an estate is settled. This means your loved ones can access money more quickly to pay funeral costs and other immediate expenses. It can take months for your estate to be settled, so your life insurance payout can cover bills and debts in the meantime.
Estate Planning
You still need money after you pass away, and life insurance is a unique financial instrument to help solve financial issues when you’re gone. Let’s say you have a will; your estate executor will still need to file tax on your behalf. Your final tax bill may include probate fees on your bank accounts or primary residence, income taxes on RRSPS or RRIFS, capital gains taxes on your family cottage or shares in a business. All of these can drastically reduce your assets. This is where Life insurance plays a vital role in estate planning, including preserving the value of your estate, providing instant funds to pay estate taxes, taxes on your retirement savings, or other outstanding debts.
How is the Right Coverage for You Determined?
It’s true that life insurance policies become more costly as you age, but there are a variety of affordable custom life insurance plans that can accommodate your unique situation, even if you aren’t in the best health.
Your right insurance plan will be considered based on your age, health profile, amount of coverage you need, your budget, and purpose of insurance. You can get permanent or term life insurance plans, or medically underwritten or simplified issued products to accommodate your unique situation.
Permanent life insurance plans offer coverage for your whole life, they have higher premiums but tax-free payouts are guaranteed to your named beneficiary(ies). Term plans are typically cheaper. They offer coverage for a specific period of time, such as 10, 20, or 30 years, with most policies expiring between ages 80-85.
Medically underwritten plans require a comprehensive medical exam to determine your insurability, while simplified issued plans skip medical exams and use a detailed health questionnaire instead to determine your eligibility for insurance.
Seek Expert Help.
Although you can shop for insurance policies on your own online, using an independent insurance broker is the best way to secure your right seniors’ insurance plan. An independent broker typically represents many providers and knows details you might not easily find online, such as the use of certain medications that can result in your insurance application being declined or that can increase your premium. Term life plans are straightforward, but permanent plans usually have so many provisions that can be hard for someone with basic or no insurance knowledge to make direct comparisons.
If you get the wrong life insurance plan, it can ruin your vision of passing on your legacy as you may not qualify to get the right plan again. This is where the expertise of Mission insurance comes in handy for you.
The Mission Insurance Advantage
We are an Alberta-based independent insurance broker. Our only goal is to secure Albertans the best-affordable insurance plans, from leading Canadian providers. We specialize in seniors' life insurance and pride ourselves on our thorough process. Our team of licensed life insurance advisors will evaluate your needs and unique situation carefully to recommend the best plan that's the exact fit for you. No matter your health condition, we can secure your insurance coverage. Get started with us today to ensure your last wishes are adequately catered for.
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