Why Term Insurance is Vital for Senior Citizens: Key Benefits and Considerations

A Term Plan for Senior Citizens offers comprehensive coverage, considering the post-retirement insurance requirements.

It is designed to provide financial security to the policyholder’s family members in their absence. Death benefits are paid to the family members in case the policyholder dies.

Reasons Why Senior Citizens Should Purchase Term Plans

Provided below are the reasons why senior citizens should purchase a term plan:

• If you are over 50 and have never had a life insurance policy, you should consider buying a term plan.
• A term plan can also be given as an inheritance as a large sum of money.
• It may bepurchased, considering the legal fees or property taxes, if any, towards the property that would be left behind after your demise.
• A Term Plan should be available to help your spouse in case of your sudden demise.
• A term plan should be availed if you don’t want to become a burden on your family, who would have to incur funeral costs, etc., after your demise.
• A term plan should be opted to pay off the outstanding debts, if any.

Things to be considered while Purchasing Term Insurance for Senior Citizens

Senior citizens, while buying a term life insurance, should keep the below-mentioned things in mind:

• The premium increases with age every year, considering any health factors or illness to cover the life risk. However, the term plan for senior citizens already includes high coverage to help secure their families in case of financial concerns.
• Though most term plans allow individuals up to 60 years of age to purchase one, the term plan for senior citizens enables the entry of up to 70-80 years, providing them whole-life coverage.
• Some insurance companies also facilitate the benefit of minimal check-ups and documentation for senior citizens having no medical history.
• It can also be bought online, considering and comparing all term plans available and best suits the requirements. 

How to Choose Term Insurance for Senior Citizens in India?

Provided below are the steps to choose the term plan for senior citizens in India:

Step 1: Choose a Suitable Life Cover

Whenever it is decided to buy a term plan for senior citizens, the right life coverage should be opted for. It should be made sure that the coverage amount should be enough to meet the financial needs of the family members in your absence.

Step 2: Check the Claim Settlement Ratio

The claim settlement ratio allows one to analyse the capabilities of the insurance company to settle the claims.

Step 3: Add relevant Riders

By adding the relevant riders, you can enhance the basic coverage of your term plan at nominal premiums, which can be calculated using a term insurance calculator. After going through the relevant additional riders available, you can add them to the base plan.

Health Conditions Required for Senior Citizen's Term Plans

Mentioned are the health conditions that are to be met to buy a senior citizen term plan:

• Insurance companies may require medical check-ups before issuing a term plan because senior citizens are more prone to medical conditions.
• The medical check-up will evaluate the health condition of senior citizens and help determine the amount of premium.
• It also helps check for pre-existing illnesses, such as diabetes, heart-related problems, and hypertension. The insurance company may reject the application or offer the policy at a higher premium amount.
• There should not be any terminal illness or life-threatening medical conditions.
• Lifestyle-relatedhabits such as drinking alcohol or smoking of the policyholder must be evaluated, which may affect their health.
• The eligibility criteria may vary from person to person; hence, it becomes crucial to review the terms and conditions of the policy before buying one.

Steps to Purchase Term Insurance for Senior Citizens

Provided below are the steps to buy term insurance for senior citizens:

Step 1: Visit the insurance company’s website from whom the insurance is to be bought.

Step 2: Choose one policy from the varied range of term insurance products. The one which aligns the most with your requirements should be selected.

Step 3: Provide the sum assured and policy tenure along with the additional riders to increase the coverage by paying an extra premium.

Step 4: Make payment via secured payment gateways provided by the insurance company.

Step 5: The medical check-ups are then performed before issuing the policy.

Step 6: The term insurance policy will then be issued after the digital copy of the policy is received at the registered e-mail address. The physical copy is received some days afterwards.

Step 7: The policy can also be bought offline by visiting an insurance company’s branch office of an insurance company or through an intermediary. For that, fill out the form and submit it along with the documents. Finally, proceed further to pay the premium amount.

Benefits of Term Insurance for Senior Citizens

Provided below are the benefits of term insurance for senior citizens:

• Financial Protection

Death benefits are paid to the policyholder’s family members in case of the policyholder’s sudden demise. This sum assured covers the expenses of the family members in the policyholder’s absence.

• Financial Independence

The policyholder feels confident that his/ her family members will not face any financial difficulty in his/ her absence.

• Affordability

It is pretty affordable compared to other plans, which makes it accessible for senior citizens.

• Tax Benefits

The premium paid is eligible to get tax deductions under the relevant income tax sections, providing financial relief.

Conclusion

Buying a term plan for senior citizens is considered to be a good decision, as it ensures the financial security of the family members in your absence.

Also, it offers income tax benefits under section 80C of the Income Tax Act, 1961. After exploring all the different options available, and then choose the term plan accordingly for your post-retirement needs.