How Much Does Over 50s Life Insurance Cost (Ages 50-59)?

Life insurance cannot replace you, but it can offer financial security by replacing part or all of your income after you pass away. This protection acts as a financial lifeline for your dependents, ensuring that essential commitments like mortgage payments, daily living expenses, or education costs are covered in your absence.

For individuals over 50, life insurance quotes can become more expensive due to increased risk factors associated with age. However, these policies often come with unique benefits tailored to the needs of older adults. For instance, over 50s life insurance can help cover end-of-life expenses, such as funeral costs, and provide an inheritance or financial cushion for loved ones.

Additionally, these policies may not require medical exams, making them an accessible option for individuals with pre-existing health conditions. Whether you’re looking to ensure peace of mind, leave behind a legacy, or address outstanding debts, over 50s life insurance can be a valuable tool depending on your personal situation and unique financial needs.

You have dependents

If you have individuals who rely on you financially, securing a life insurance policy is essential. Life insurance serves as an income replacement tool, ensuring that your dependents can continue to meet their financial obligations even after you're gone. For instance, it provides your surviving spouse with the necessary funds to cover ongoing monthly expenses, such as utility bills, groceries, and insurance premiums. By selecting the right life cover, you can ensure that your loved ones are financially protected during a difficult time.

Additionally, it can help pay off large financial commitments, like your mortgage or any outstanding debts, relieving your loved ones from the burden of these obligations during an already difficult time. If you have children, a life insurance policy can also contribute to their education expenses, ensuring they are able to pursue their studies without the added stress of financial instability.

By providing this financial security, life cover helps to preserve the quality of life for your family, allowing them to maintain their standard of living and continue with their day-to-day activities while they cope with their loss. It also offers peace of mind, knowing that you’ve taken proactive steps to safeguard their future, no matter what happens.

You may also need a life insurance policy if you are single but support a parent or a close relative. Ask yourself: What will happen to your dependent if they were to suddenly lose you and the support you provide?

Getting life insurance at 50 can be expensive. We recommend talking with an advisor to get the best deal possible.

You have debts others will inherit

When you pass away, your estate becomes responsible for settling any outstanding debts you owe. However, if you have a co-borrower or co-signer—whether it's a spouse, parent, sibling, or friend—they may inherit your debt. This can place a significant financial burden on your loved ones, particularly if they were not expecting to assume this responsibility or do not have the means to pay off the debt. To help protect them, it’s important to consider how much cover you need. A policy with a coverage amount that matches your debts, typically in the range of $100,000 to $500,000, can ensure that your loved ones aren't left with the financial load.

For example, if you have a mortgage, personal loans, or credit card balances and no life insurance policy in place, the lenders will turn to your estate to recover the owed amounts. In cases where there isn't enough in the estate to cover these debts, those listed as co-signers or co-borrowers may become personally liable for repaying the balance.

Purchasing an over 50s life insurance policy is an effective way to protect your loved ones from inheriting this financial burden. With a life insurance policy, you can ensure that the necessary funds are available to pay off any outstanding debts upon your death. This way, your spouse, children, or other co-borrowers won’t be left struggling to cover what you owed.

Having a life insurance policy also ensures that your loved ones have the financial security they need to carry on without the added stress of dealing with the aftermath of your debt. It offers peace of mind knowing that, no matter what happens, your financial responsibilities will be taken care of, leaving your family members to focus on grieving and moving forward.

You want to preserve the value of your estate

Life insurance is a key part of estate planning, especially for those looking to preserve the value of their estate. Proceeds from your policy can help offset expenses like estate taxes that can chip away at the inheritance you want to leave to your heirs.

You want to leave an inheritance

Life insurance is an ideal way to leave an inheritance for those you care for. That is because they will not have to pay income tax on the cash sum they receive.

You want to bolster your retirement savings

Some over 50s life insurance policies include a built-in investment component, called cash value. The policy’s value grows over time, usually at a fixed rate. Besides being a source for tax-free retirement income, it can buttress your investment portfolios. Its stable growth acts as a volatility buffer during a market downturn and makes it easier for you to pursue higher-risk, higher-return strategies with other investment vehicles. How much cover you need will depend on your financial situation, but many people consider policies with a $250,000 to $1 million death benefit, depending on their goals and responsibilities.  

You want to take care of funeral costs

With the average funeral costs being upwards of several thousands of dollars, planning for it is a good idea. It will save your loved ones money and stress when the time comes.

You want to protect your business

You have spent years establishing your business. The last thing you would want is for it to go under after your death. If you own a business, putting a business continuity plan in place is crucial to protect it in the event of death. A life insurance plan can help a business survive if a key employee dies prematurely. It can help:

Fund a buy-sell agreement

Cover the cost of hiring a replacement

Fund a supplemental retirement program

Pay off loans and mortgages

Payment of loans and mortgages

Which policy should I choose?

Depending on personal circumstances, certain over 50s life insurance policies will suit you better than other life insurance options. The Life insurance plan consist of two types — term or permanent. With term life insurance, you get coverage for a certain number of years or until a specific age. These policies have only one purpose — to pay the death benefit upon your death, provided the policy is active. These plans do not build account value and are usually six to 10 times cheaper than permanent life cover.

Permanent life insurance, as the name suggests, offers coverage that lasts your entire life. Many permanent life policy plans also accumulate cash value, which grows over time on a tax-deferred basis. Your policy’s value is for you to use during your lifetime. Your beneficiaries receive only the death benefit (that is, the coverage amount or life cover)

So, which one is right for you — term or permanent life?

It all depends on your financial needs and budget. For most people, term life insurance is sufficient. It is a more suitable option when your financial needs have an end date. For example, if you want over 50s life insurance to provide protection until you retire and/or pay off your debts, a term life insurance policy will suit you better. You can pick a policy term and coverage amount that works for you. Since term life insurance offers affordable life cover, those on a budget will also find it an attractive option. If you’re looking for life cover that ensures your loved ones are financially protected in the short term, this is the ideal choice.

Permanent life insurance, in contrast, may be a good choice for financial needs that do not have an expiry date. For instance, if you have a lifelong dependent or want to leave a legacy for your heirs, consider buying a permanent life policy. High-net-worth individuals looking for an additional investment account might also benefit from buying a permanent life policy with the accumulated value feature.

Factors that affect the cost of life insurance

When considering over 50s life insurance, several factors come into play in determining your premiums. These factors help insurers assess the level of risk you represent. Understanding these factors can help you make informed decisions when purchasing life insurance for individuals over 50.

Here are some of the main factors that affect life insurance rates:

1. Age

Your age is a key factor in determining your over 50s life insurance premium. Generally, the older you are, the higher your premiums will be, because life insurers base their calculations on life expectancy. Younger individuals benefit from lower rates, while those over 50 will face higher premiums.

2. Gender

Gender plays a significant role in the pricing of life insurance. Statistically, women tend to live longer than men, which means they usually pay lower premiums for over 50s life insurance. This pricing structure reflects the longer expected life span, reducing the likelihood of an early payout.

3. Health Status

Your overall health directly impacts the cost of your over 50s life insurance. Insurers will assess any existing health conditions like high blood pressure or diabetes, which could increase the premiums. Those in good health generally receive lower premiums for life insurance policies.

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4. Smoking Status

Tobacco use is a major factor that drives up the cost of life insurance pln. Smokers face higher premiums because they are at a higher risk for serious health conditions. If you're a smoker, you can expect to pay more for over 50s life insurance, as smoking significantly affects your health and increases the insurer’s risk.

5. Family Medical History

Life insurance companies may also review your family medical history when determining your premiums. If there’s a history of serious conditions, such as cancer or heart disease, your over 50s life insurance premiums could be higher. A strong family medical history of health issues increases the likelihood that you may develop similar conditions.

6. Occupation

Your job can also influence your over 50s life insurance premiums. Certain high-risk jobs, such as being a firefighter, police officer, or miner, can lead to higher premiums due to the potential for injury or death. Insurers will assess your occupation to determine the level of risk associated with your profession.

7. Driving History

A poor driving record does not sit well with insurance companies because it points toward an increased risk of death. You are more likely to be involved in a serious accident if you are a careless driver.

Brace yourself for a higher life insurance premium if you have collected three or more driving tickets in the last six months. Moving violations, like tailgating, may also raise your life premium rates, but it is a DUI (driving under influence) that has the biggest impact. A DUI conviction can seriously increase your life insurance cost or even make you uninsurable for the next 12 months.  

8. Policy Type

Term life policies, on average, are six to 10 times more affordable than comparable permanent plans. Within term life insurance, policies with longer terms, like 30 years, have a higher price tag than those with shorter terms.

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9. Policy Amount

This refers to the amount the beneficiary receives when the insured dies. The higher the life insurance plan amount, the more the over 50s life insurance will cost. A $1 million policy will be more expensive than a plan with a coverage amount of $500,000, other things being equal.

10. Policy Riders

Life insurance riders enhance your life insurance coverage or add new benefits — sometimes for free and sometimes for a fee. Riders like waiver of premium or accidental death benefit can increase your monthly premiums.

How much does it cost?

So, how much is life insurance for adults in their 50’s?

Over 50s life insurance costs depend on your personal circumstances, the type of life insurance policy you want, and the amount of cover you need. Generally speaking, women receive lower rates than men since they tend to live longer.

Here are sample life insurance rates for applicants who are 50-years-old. Life insurance rates tend to rise sharply in your 50’s, so do not put off buying coverage once you have decided you need it. For every year you postpone buying it, the premiums go up by 9% to 14%.

A 50-year-old non-smoking, healthy female may pay $71 a month for a 20-year term life policy with a $500,000 death benefit. The same life insurance policy, however, may cost $93 a month for a healthy 50-year-old male.

Looking for a whole life insurance policy? Expect to pay six to 10 times the cost of term-based life insurance. Smokers, on the other hand, are likely to receive premium rates that are two to five times the non-smoking rates.

When considering how much cover you need, remember that the higher the coverage amount, the higher your premiums will be. You’ll need to balance the amount of cover with your budget to ensure it fits your financial situation.

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Why is it so expensive?

Why does life insurance cost so much for someone in their 50's?

Life insurance premiums increase as we age. That is because the older you get, the more risk you have of dying. So, all other things being equal, a 50-year-old woman will pay more for coverage than a woman who is in her 40’s or 30’s. Additionally, many 50-year-olds have an underlying health condition, like diabetes, and consequently, receive higher premiums. Best life insurance companies need to make money and so, the bigger liability you are, the more expensive your life insurance will cost you. As a result, the monthly premiums for life insurance will rise with age and any pre-existing health conditions, reflecting the increased risk to the insurer.

All the same, there are several things you can do to reduce your over 50s life insurance cost, such as:

• Giving up smoking. Staying smoke-free for 12 months can help you qualify for better rates.

• Get in shape. While you cannot stop the clock, eating well and exercising will lower your life insurance cost.

• Do not over-insure your life. Factor in your income, debt, budget, and other financial factors to determine how much coverage will be sufficient for your family. If in doubt, speak to an independent life insurance advisor. Buying too much coverage is almost as bad as buying too little since it means wasting a sizeable amount of money that could have been used for some other purposes, like taking more family vacations.

• Combine yours and your spouse’s policy into one. If you and your partner are fairly healthy, buying a joint life insurance policy may be much cheaper than purchasing two separate plans.

• Shop around. Grab quotes from as many life insurance providers as possible to ensure you are paying the lowest possible price.

Conclusion

You may need life insurance in your 50’s as much as ever, especially if you have dependents or want to leave an inheritance. It is also nice for your family to not have to worry about funeral costs.

As to how much over 50s life insurance will cost, that depends on your risk profile and coverage needs. Dundas Life works with top names in the Canadian Life Insurance industry and can help you find the right coverage at a great price.

Frequently Asked Questions

Why might someone in their 50s need life insurance?

People in their 50s often have financial obligations such as mortgages, loans, or dependent family members. Life insurance helps to cover these financial responsibilities in the event of their untimely death, providing financial stability for their loved ones. In addition, life insurance can be used to cover funeral costs, protect business investments, and even to leave a legacy or inheritance.

How can someone reduce the cost of life insurance in their 50s?

Several strategies can help reduce life insurance costs in your 50s. Leading a healthy lifestyle, including regular exercise and maintaining a healthy diet, can reduce premiums. Quitting smoking can significantly decrease rates as well. It's also wise to avoid over-insuring; buy just enough coverage to meet your financial needs and consider how much cover you truly require. Shopping around for the best rates and considering term-based life insurance, which is typically cheaper than permanent insurance, can also help save costs.

What's the difference between term life insurance vs permanent life insurance for someone in their 50s?

Term-based life insurance provides coverage for a specific period, such as 10, 20, or 30 years. If the insured person dies within this term, the death benefit is paid out to the beneficiaries. Term insurance typically has lower premiums and may be suitable for individuals in their 50s who have specific, time-bound financial obligations.

Permanent life insurance, on the other hand, provides lifelong coverage and has a policy value component that grows over time. This type of insurance can be beneficial for those wanting to leave an inheritance, cover lifelong dependents, or supplement retirement income.

What happens if I can't afford the premiums of my life insurance policy when I'm in my 50s?

If you're struggling to afford your premiums, reach out to your insurance provider to discuss your options. You might be able to reduce the death benefit and, subsequently, the premiums. If you have a permanent life policy, you might be able to use some of the policy's cash value to cover the premiums. Switching to a term-based life policy could also be a more affordable option.

Why might over 50s life insurance be beneficial for business owners?

Life insurance for business owners, particularly those over 50, can help protect the business in the event of their death. It can help to cover business debts, provide funds for hiring a replacement, or fund a buy-sell agreement, allowing the remaining owners to buy out the deceased owner's share of the business. Moreover, life insurance can also be used to set up a supplemental retirement program.