 Written by Leland Jeppesen
You might be so lucky to have found an amazing life insurance plan that will cover all your final expenses at an exceptionally low cost. How did you do it? Maybe it was a special member discount, a promotional offer or a relative that got you signed up just at the right time. If so, that’s great.
But it’s more likely that your price is so cheap because of one of these 5 reasons below. Read on because #1 may make you want to come back from the dead, and not in a good way!
#5) You have an accident-only plan
If you bought your coverage from your credit-union or bank and believe you are getting some kind of member-discount, it’s highly likely you have an accident-only plan. This means that your coverage will NOT pay unless you die due to an accident. These plans normally cover $100,000 or more for less than $20/mn. Such a good deal, right? The problem is many seniors do not realize these plans will not pay if they die of any natural cause. What’s more is that the vast majority of these plans do not last to life-expectancy but expire at age 70 or 75. These plans might be appropriate for you, but don’t count on them paying out.
#4) Your plan has price increases
If you have a very low rate now, then there’s a decent chance your plan will have price increases later on. Globe Life is famous for this with plans that start for just $1, only to be increased exponentially over time. Check your policy and you can see what kind of price increases you can expect as time goes on. Unfortunately, these plans become a burden for many seniors who later are forced to cancel them.
#3) Your plan has coverage decreases
Some plans may decrease coverage over time. So what started out as a $20,000 plan becomes a $10,000 at a later date though the premium stays the same! So, what seemed like a great price in the beginning becomes a not-so-great price later on.
#2) Your policy expires prior to life expectancy
Today, life expectancy is in the early to mid ‘80s. Many plans such as AARP NY Life can end at age 80. Your plan may have a really great rate but if you live beyond 80 the plan will no longer cover you.
Bonus Reason: Your company has NO financial grade or a low grade
If you have a company that nobody has heard of but has such amazing rates, then there’s a good chance the company has NO financial grade or has a very low grade. The question then becomes; will this policy payout in 20-30 years’ time when needed? Hopefully yes, but why risk it when there are plenty of A grade carriers out there to pick up coverage with?
#1) Your policy will NOT payout!
The #1 reason why your life insurance coverage is so ridiculously cheap is because it will NOT payout. Due to all of the above, the plan you have now may not pay and the premiums that were paid become pure profit for the insurance company. Was your plan designed this way from the start? Maybe, but unfortunately you may not be around to do anything about it because you’ve moved on to a more permanent address!
So, if you’re alive now and want to guarantee that your plan does pay, while ensuring that what you have is really what you think you have, it’s recommended that you do a policy review of your plan. Here at Life Insurance for Seniors you can get a comprehensive policy review done at no charge. Even if you do not have the physical policy anymore you can do this as long as you know the company name you are with. To do so you can book a time here.
It is possible you may have the best plan available on the market, and if so we’ll tell you plainly. But if not, we can talk through the reasons to consider better choices.
The last thing you want to do is pay on a plan for years, only to find that it is not going to pay as expected. Know your plan and your choices.
