How much does over 50 life insurance cost?

How Much Does Over 50 Life Insurance Cost?

By Vicki Coleman

If you’re in the market for over 50s life insurance, the first thing you’ll want to know is how much it’s going to cost you. For many, especially at the moment, everything in life boils down to how much it’s going to cost. That’s especially true for life insurance as you, personally, will never see a penny of what you pay for your cover.

There are a few exceptions to this, for example if your policy comes with critical illness cover in which case you might receive your payout prior to death. But generally speaking, it’s your loved ones who will benefit from you paying your premiums every month.

This fact is unlikely to come as news to you, but spelling it out might remind you of the importance of looking around for the best deal possible – and ideally, keeping your premiums as low as possible.

Is over 50s life insurance worth the investment?

Before you take out over 50s life cover, it’s worth pausing for thought and considering a few things, such as:

·       Do you have any serious medical conditions?

While over 50s life insurance is designed to meet the needs of older people by guaranteeing them some level of protection, with no medical questions asked – if you were to die within a couple of years of taking out a policy, you wouldn’t get a payout (merely a ‘refund’ of your premiums).

So, if you have a life-limiting medical condition, you might want to consider all your investment options before plumping for a life insurance policy.

·       What’s the longevity of other family members?

One of the criticisms of over 50s life cover is that you can end up paying more in premiums than the policy pays out. For example, if you take out a policy at 50, most people will reach this point at some point in their 70s.

Generally, you’ll have to keep paying your premiums until you’re in your 80s, so you could well exceed the payout. For some families, it might be rare for someone to reach their 80s or 90s, while for others it’s fairly common. And while you can never tell what age you’ll live to, it's worth taking into account your family’s average lifespan when negotiating your cover.

·       How good are you at saving?

The most obvious alternative to life insurance is to pay money regularly into a savings account which remains untouched until you pass away when the money is handed over to loved ones.

In a recent survey[1] of UK adults over 50, over half (52%) of the respondents said they would prefer to put their cash into savings plans than take out life cover. But for many people, saving just isn’t a viable way of guaranteeing financial security for their loved ones.

You never know; you might end up dipping into your savings at some point to pay for some unexpected costs or even pay for your retirement. We’ve seen all too recently with unforeseen events like the COVID-19 pandemic and the cost-of-living crisis how difficult it can be to save money for the long term.

Life insurance is a more secure option, as you simply won’t be able to touch the money that you pay in premiums.

What you need to factor in when taking out over 50s life cover

Over 50s life insurance premiums start from as little as £5 a month, with the cost based on factors such as your age, your lifestyle and your payout. But it might not prove the best value for money to simply opt for the cheapest deal.

That sentence might have left you scratching your head, so let us explain.

You really need to think about whether the lump-sum payout will prove enough for your loved ones to pay for funeral costs, cover any outstanding debts and potentially live off for a period of time.

While the £5 or £7 per month policies might naturally have the greatest appeal, they often have the lowest payouts.

You should factor everything from your health to inflation when taking out over 50s life cover. While the insurer might not ask too many questions, you should still ask them of yourself.

But, of course, you need to be able to make sure you can afford to pay for premiums for the duration of the policy. If you miss a payment – even if it’s your last one – your insurance provider could invalidate your cover. That means no payout for your loved ones.

If you miss a payment or a series of payments, your insurer will alert you and you will usually have up to six months to set it right. But it’s not a position you really want to find yourself in.

There are inflation-linked plans available which will mean your payout (and your premiums) will rise in line with the retail prices index (RPI) level of inflation. So, if you’re concerned the lump sum promised by your policy won’t amount to much in 30 years’ time, you might want to consider an inflation-linked plan. Or if your budget can stretch, pay more for a more lucrative plan.

What will your premiums be?

You might have reached this point of the article and be wondering where the answer to the question is… Well, there is no single answer to the question of how much over 50 insurance costs.

It depends on all those factors we’ve described over the last 800 words or so. But there’s a sure-fire way of finding out how much life cover will cost you: let us generate some quotes for you.

It couldn’t be simpler – just provide us with a few details and we’ll do the rest.

If you don’t wish to proceed with any of the quotes, no problem – you can rest assured your information will be stored securely and won’t be shared without permission. In other words, you won’t be bugged by insurance providers if you decide life cover isn’t for you!

So, what do you have to lose? To compare your free over 50s life insurance quotes from leading providers, click here.