Everyone wants a peaceful, comfortable and carefree life, not only for themselves but also for their family. It’s our responsibility to guarantee a secure future for our elderly parents, our children or our spouse.
Even when you have grown old and grey, you might be in need of a term insurance policy. A term plan, as you may or may not know, acts as a financial saviour to the beneficiaries of the policyholder if they pass away unexpectedly. These days the market offers a plethora of term insurance policies for the elderly.
But why would senior citizens need a term plan? Let’s understand why term insurance schemes can prove to be beneficial for them.
Importance of Term Insurance for Senior Citizens
Your parents become dependent on you for everything when they grow old, including their expenses and other financial requirements. If you happen to be the only breadwinner in your family, you must consider buying a term plan for your aged parents. Considering the possibility of an unfortunate occurrence in future, buying a term plan will be a prudent move. Your term plan will take care of the financial needs of your parents in your absence.
In the opinion of several experts, you must invest in a term insurance scheme when you are young. This is because the premium to be paid is quite low when you are young. But even the elderly can choose to buy a term plan. You can be a pensioner and you would still be eligible to buy it.
Sometimes, a pensioner may turn out to be the only breadwinner in their family. Even when they’ve grown old, their spouse or their sons and/or daughters may still be financially dependent on them. Even when they are well past their prime, they might still have to take care of unpaid debts.
They may also wish to leave a legacy behind. A term plan can be of immense help to them under such circumstances. In the event of their untimely demise, their term insurance can emerge as the saviour of their loved ones.
For example: A 60-year-old man decides to buy a term plan with a cover of INR 25 lakhs to provide security to his 54-year-old wife and his 33-year-old unemployed son. The premium, in this case, will amount to INR 2200.
| Age | Age (years) | Sum Assured (INR) | Premium (INR) |
|---|---|---|---|
| 60 Years | 60 | 25 lakhs | 2200 |
Key Features of Term Plans for Senior Citizens
Some of the key features of term plans meant for senior citizens have been discussed below:
Age Limit: Life insurance companies have come up with several term insurance schemes for the elderly. Individuals in their 50s and 60s can opt for these schemes, which often provide coverage up to about 75 to 80 years of age,
Insurance Coverage: The coverage amount will be paid to the beneficiaries only if the policyholder passes away during the policy tenure. If they had opted for the return of premium option at the time of buying the policy, their beneficiaries would receive the total amount of premiums at the end of the policy tenure. Many insurance companies will offer insurance covers which senior citizens can afford.
Premium Rate: The rate of premium to be paid by the elderly is higher than that paid by young policyholders. The rates will be affordable, nevertheless.
Medical Test: Senior citizens have to undergo a thorough medical check-up before buying a term policy. They might choose to produce a fitness certificate before the insurance provider instead of undergoing medical tests. The insurer will approve of the policy only when they are convinced that the potential policyholder does not suffer from any pre-existing health condition.
Riders: Senior citizens can opt for the additional benefits known as riders which come with a term plan. These riders include critical illness rider, accidental death benefit rider, etc. However, an additional amount needs to be paid to avail of the benefits provided by these riders.
Top Term Plans for Senior Citizens
Nowadays, quite a few insurance service providers offer term plans for senior citizens above the age of 60. Some of the top insurance schemes meant for the elderly are:
Aegon Life iTerm Plus Plan: Aegon Life iTerm Plus is an online term plan. It offers four plan options to customers along with additional benefits such as accidental death and critical illness cover based on the policyholder’s choice.
IDBI Senior Citizen Term Insurance: This plan has been introduced by IDBI Federal Life Insurance exclusively for senior citizens. You can opt for this plan if you are in your fifties and the maximum entry age for this plan is 85 years.
LIC e-Term Plan: LIC e-Term Plan is an online term policy and is also one of the most acclaimed financial products offered by LIC. This plan offers death benefit only in the event of the unfortunate demise of the policyholder.
Max Life Insurance Online Term Plan Plus: This online term plan offers a coverage up to 85 years of age. This plan is available in as many as 377 Indian cities and even NRIs can choose to buy this policy.
SBI Life Poorna Suraksha Plan: It is a non-linked term insurance scheme and it offers an in-built critical illness cover as well. If the policyholder is diagnosed with a critical illness covered by this plan, the future premiums will be waived off.
A Comparative Study of the Top Term Plans for the Elderly
The following table offers a comparative study of the various term plans which might prove to be beneficial to senior citizens above the age of 60:
| Sl. No | Plan Name | Entry Age (years) | Premium (INR) | Sum Assured (INR) | Unique Features |
|---|---|---|---|---|---|
| 1 | Aegon Life iTerm Plus Plan | Minimum: 18 Maximum: 65 | Based on the insurance cover chosen by a policyholder |
|
|
| 2 | IDBI Senior Citizen Term Insurance | Minimum: 50 Maximum: 85 |
| 5 lakhs |
|
| 3 | LIC e-Term Plan | Minimum: 18 Maximum: 60 | Based on the sum assured and the chosen category | Minimum: 25 lakhs For non-smokers: 50 lakhs |
|
| 4 | Max Life Insurance Online Term Plan Plus | Minimum: 18 Maximum: 60 (it can be extended till 85 years of age) | Minimum: 2200 Maximum: 2,18,44,600 | 25 lakhs - 100crores |
|
| 5 | SBI Life Poorna Suraksha Plan | Minimum: 18 Maximum: 65-75 | Minimum:
Maximum:
| Minimum: 20 lakhs Maximum: 2.5 crores |
|
Summary:
At the age of 60 and beyond it, you might be in need of term insurance plans to ensure financial comfort for all those who might be dependent on you. Sometimes the amount of premiums to be paid might be higher than that paid by young policyholders. But if the need arises, you can always buy a term insurance when you have grown old. However, always be mindful of the financial needs of your nominee(s). A little research and consulting your acquaintances or an advisor before you buy a plan might also prove to be extremely helpful.
