Today, seniors in Canada are the fastest growing segment of the population and becoming the largest segment of the life insurance economy. There are now over 4.5 million Canadians over the age of 65, and by 2022, there will be nearly 8 million Canadians over the age of 65. When looking at these statistics, it is easy to see why it is so important for seniors in Canada to have life insurance.
As a senior, your needs for life insurance will likely be different than when you were younger. Life insurance for seniors is a necessity for the following reasons:
Many seniors are looking to purchase a life insurance policy as way to pay for their final expenses. These expenses include funeral and burial costs. If you do not have these costly expenses covered, than your family will be burdened for those costs. The result can be thousands of dollars your family will have to pay out. A life insurance policy can easily cover your final expenses.
Create Your Estate
Sometimes seniors will use life insurance to create their estate. It is an easy way to leave a specific amount of money to loved ones, perhaps your children or grandchildren. And when you look at the cost of life insurance for seniors, it is an economical way to leave a financial gift to those you most love after you pass away.
Using life insurance to create an estate is a convenient way to leave money behind to loved ones as the benefits from a life insurance policy are typically available within a week or two of the claim being filed. It can even be available within a few days after being processed by the insurance company. It is a great way to ensure that funds are available fast so your beneficiaries do not have to worry about coming up with money to pay for such expenses as final arrangements on short notice.
Avoid Taxes and Preserve Your Estate
When you leave your estate to a spouse, there are normally no high taxes to pay to the government. However, when your beneficiaries are children or grandchildren, there are taxes on assets that have to be paid. If the taxes that are paid come from your estate, sometimes these assets may have to be liquidated to pay them. If you want to avoid liquidation of your assets such as a family home, life insurance benefits can be used to pay the taxes. This allows for the assets like the home to be preserved for children or grandchildren.
Amount Of Life Insurance Seniors Should Purchase
Amounts such as $25,000 or $50,000 are often selected by seniors for creating an estate or for paying for final expense/burial costs. If you want to use it for preserving your estate or to pay taxes, a much higher life insurance policy should be considered. It is important to determine how much life insurance you need before you make your decision.
Types Of Life Insurance For Seniors
Most seniors seek to acquire life insurance that provides coverage for their lifetime. Permanent life insurance policy such as universal life insurance or whole life insurance provide lifetime coverage as long as you keep up with your payments. No medical exam life insurance, or no medical life, is another type of life insurance seniors will purchase. No medical exam life insurance is chosen if a senior has a medical condition, unable to qualify for a traditional policy, is much older, or does not want to take a medical exam. These policies have a guaranteed acceptance and frequently come with limited benefits.
Today, many insurance providers now offer life insurance to seniors up to age 85. The rates vary between ages 65, 75, and 85. The best time to look into life insurance is right now because the sooner you are covered, the sooner you will have peace of mind.