A life insurance policy is a contract with an insurance company. The company agrees to pay out a certain sum of money in the event of your death. If you have dependents, they may be eligible for benefits on your life insurance policy if you pass away. In this article, we will discuss the various features one can get from life insurance for seniors.
Riders
In addition to the base policy, riders are additional benefits that are added to a life insurance policy to provide extra coverage. Riders can be added at any time after you have purchased your main policy and will often be cheaper than having them as part of your initial plan.
Examples of riders include waiver of premium, double indemnity and accidental death benefit.
Waiver of premium is one of the most common types of rider available for seniors looking for additional security against unforeseen circumstances that may arise in their retirement years.
This option allows you the comfort of knowing that if there was ever an emergency situation or unexpected medical condition that prevented you from making payments on your monthly premiums, then this rider would automatically cancel out those past-due payments, so there wouldn’t be any lapse in coverage during those times when money is tight but still needed.
Death Benefit
A life insurance policy’s death benefit is the amount of money you will receive if you die while the policy is in force. The death benefit is usually expressed as a multiple of the premiums paid, so if you pay $100 per month for your policy and it has a death benefit of $10,000, then if something happens to you and your beneficiary receives a check for $10,000. If there are no beneficiaries listed on your policy, then typically, all proceeds from your insurance will go directly to your estate. This can be especially helpful if there are outstanding debts that need to be paid off after someone dies unexpectedly.
Tax Benefits
Life insurance has several tax benefits. This is one of the reasons why many people buy a life insurance policy when they reach old age.
As per Ethos’ experts, “When you pay premiums for your life insurance policy, the amount paid will be deducted from your taxable income.” You can also claim tax deductions for any premiums you have paid on behalf of someone else as well as for yourself.
If you make a claim under your life insurance policy and are compensated for it (the money paid out to you), then there will be no tax consequences for either party involved in this transaction.
Premium waivers
One of the most popular features of a life insurance policy for senior citizens is the premium waiver. The premium waiver is a feature that allows you to retain the same premiums you were paying when you were younger, even if your health has deteriorated and your risk profile has increased. This means that as long as your age doesn’t increase, your monthly payment won’t either.
Life insurance is a great investment for seniors. It’s affordable, and there are tax benefits to consider as well. There are also different options available, so you can choose the one that best fits your needs and goals.