The Best Term Life Insurance for Seniors Over 60

Senior life insurance options for people over 60

Seniors over the age of 60 have several life insurance options in Canada:

• Term life insurance
• Whole life insurance
• Final expense insurance (a type of whole life insurance)

A term life insurance policy is usually the best option for most people over the age of 60.

Term life insurance covers you for a set term, like 5, 10, or 20 years. It’s a more affordable life insurance policy than whole life, and it’s a good way to achieve peace of mind if you still have financial obligations, outstanding debts, or dependents in your older age. The main drawback is that there is no payout if you pass away after the term expires; your beneficiaries will only receive a death benefit if you die while the policy is active.

Whole life insurance is a type of permanent insurance that covers you for your entire life, as long as you keep paying the premiums. It’s more expensive, but it accumulates cash value and there is a guaranteed payout no matter when you pass away. It may be an option if you have lifelong dependents or for estate planning purposes.

Final expense insurance is intended to cover end-of-life costs, like funeral expenses or final debts. It’s a type of permanent coverage, so it lasts your whole life and has higher premiums than term coverage. The payout is typically smaller than term and whole life, but it’s a guaranteed sum if you’re concerned about funeral costs.

Do you have a policy that’s about to expire?

If you currently have a term life insurance plan that is near its end, you have several options. You can extend the term (with a new, higher premium), convert to permanent coverage (same premium, no medical exam), or shop for a brand new policy.

Premiums increase as you get older, no matter the life insurance company. If you need coverage, applying sooner will help you secure the best rates available to you—and term life insurance is typically the best, most affordable option to ensure financial security for your family members.

How much is life insurance for ages 60+ cost?

The cost of life insurance in Canada is quite high for Canadians over 60, averaging $75 to over $400 per month for a term policy with a payout of $250,000 to $500,000. These are sample PolicyMe life insurance rates for 10- and 20-year term policies for nonsmoking 60-year-olds:

* Smokers can expect to pay more for the same coverage

Whether you’re buying a new policy or renewing an old one, make sure you update your beneficiaries. If you’ve gotten married, divorced, had children, or your family has changed, check that your beneficiaries accurately reflect your wishes. You can name a charity, too!

”When your budget is tight, you can save on your life insurance premiums by shortening the term length or reducing the coverage amount. Consider that if you’re covering something like a mortgage, maintaining the term length is more important since the outstanding balance gets reduced over time. Same applies if you’re looking to leave behind some cash for children in the event of a premature death.” —Emil Daniel, Life Insurance Advisor

Factors that impact premiums for life insurance over 60

Age has an outsized influence on your life insurance premiums. The older you are, the more you can expect to pay for coverage. But these factors also impact the cost of your life insurance policy:

• Type of policy
• Sex at birth
• Pre-existing conditions
• Smoking status
• Weight
• Lifestyle and hobbies
• Medical history

When you’re applying for life insurance, be honest with your insurer about your lifestyle and medical history. Telling the truth ensures you get an accurate quote and that your loved ones get a payout. If you mislead the company—purposefully or accidentally—you could forfeit some or all of your death benefit, leaving your family without a financial security net.

Is life insurance worth it if you’re over 60?

Life insurance coverage may be worth it if you’re over 60 and you’re concerned about your loved ones’ financial stability in your absence. For example, you:

• Still have a mortgage or other significant financial obligations
• Are still caring for dependents who rely on them financially 
• Wish to leave a legacy or inheritance but haven’t saved enough
• Are worried about covering end-of-life expenses

Life insurance products are designed for income replacement. By the time you reach 60, you’re likely nearing the end of major financial obligations, such as paying off a mortgage or supporting children. In these situations, life insurance may not be necessary, or a shorter-term policy—such as 5 or 10 years—may be sufficient.

”Between the ages of 50 and 60, you’re coming to the end of your first term and considering whether to get term into retirement age or opt in for a more expensive whole-life plan that’s going to act as final expense coverage whenever you pass away. The need for insurance is not significant, but you’re looking for final expense coverage.” —Erik Heidebrecht, Life Insurance Advisor

FAQ: Best life insurance for seniors over 60