For seniors funeral cover and other after-death expenses can pose a real worry. After all, no one likes the idea of causing their loved ones financial hardship during a time of grief. Many seniors are therefore drawn to specialised ‘Over 50’ insurance plans. These plans, which promise to pay out a sum of money to family members upon a senior’s passing, have no set health requirements, making them an ideal choice for many elderly people. They’re also flexible; a payout will usually be made whenever the plan holder passes away, with no predetermined expiration date. All these plans ask is that a person be between the ages of 49-85 in order to get a policy.
While over 50 insurance plans are usually fairly modest in terms of the payouts they provide, at present they’re generally adequate for seniors funeral cover. Depending on the plan you choose, there may also be enough money left over to pad the savings accounts of loved ones. This is particularly important to many seniors given the fact that living children might need to take some time away from their usual career duties to deal with the grief of losing a parent.
As is the case when making any major financial decision, you should weigh your options for seniors funeral cover carefully before selecting over 50 insurance. Whether or not over 50 insurance is the best choice for you will depend on a number of factors, such as your state of health and financial situation.
While over 50 insurance is ideal for seniors who already have health problems (and who otherwise lack life insurance), it’s not always the best option for a healthy elderly person. Someone who is 50-plus and still boasts excellent health may be able to reap more significant financial rewards from conventional life insurance. This is due to the fact that over 50 insurance is tailored to those who have health issues: The payouts of these plans are smaller in order to compensate for the number of policy holders who will pass away within five or ten years of taking out a policy. Likewise, people in good health who choose over 50 insurance instead of conventional life insurance risk paying more into the plan than their loved ones will receive. For example, if you select a five-pound-per-month plan at age 60 that offers a total payout of £895, then pay into it for another two decades, you will end up paying £1,200 for that £895.
Your financial situation is another important determining factor in which type of life insurance policy you choose. Seniors with limited means often find over 50 insurance to be the best option for them because these policies are usually inexpensive. While there are more costly forms of over 50 insurance available, many popular plans in the UK start at just four or five pounds per month, making them affordable to nearly everyone (though this low amount is reflected in the final payout). Seniors who are well off, on the other hand, may find that they prefer conventional life insurance (due to the more generous payouts offered) even if the monthly rates are much higher for them owing to health issues.
The financial situation of your family is another key point to consider. While the payouts offered by over 50 insurance policies may look adequate today, you need to keep in mind just how quickly the cost of funeral services is rising. According to The Telegraph, funeral costs in the UK are currently rising by a shocking rate of five pounds per week. This means that by 2023 even the most basic of funerals will cost at least £6,107. (Keep in mind that this figure does not include extras like a memorial, catering services, flowers, and the legal fees needed to administer the estate—all of which already amount to an additional 2000 pounds or more.) You must therefore ask yourself if a basic over 50 insurance plan will be enough to cover funeral expenses, let alone be enough to cover them and provide extra funds for your loved ones’ savings accounts. After all, even a mid-range £25 per month policy will only produce an average final payout of £5,815. If your family is struggling financially, an inadequate over 50 insurance plan may leave your children with funeral-related debt.
Ideally, if over 50 insurance is the only kind of life insurance you can afford, in order to provide full funeral coverage you should purchase an additional funeral cover plan. These plans, which are also highly affordable, deposit money into a regulated funeral trust where it will grow in tandem with the rising cost of funeral services. This ensures that your loved ones will be financially secure after your passing regardless of how much funeral costs rise in the interim.