Over 50s cover – what you should be aware of 
There are few purchases in life you will make that are quite as important as life insurance. For your own peace of mind and the future financial security of your loved ones, it is essential you fully understand exactly what to expect from the cover you buy. Here is our essential guide to what you should be aware of when buying over 50s life cover.
No cash-in value
Over 50s policies have been designed to last for the entire duration of your life. In simple terms, this means that the only time an over 50s plan will pay out it is when you die. If you no longer choose to pay the insurance premiums and cancel the policy, you will not be reimbursed any of the money you have paid into the policy. The policy also has no ‘cash-in-value’ to take advantage of while you are alive.
Comparably low payouts
Compared to term life insurance policies, the payout you can expect from over 50s plans are relatively low. The reason is that over 50s policies are guaranteed to accept anyone between the ages of 50 and 80. This additional risk for insurance companies, often taking on individuals who would not be accepted onto other life insurance policies, tempers the payout of the plan.
It is well worth noting that it is possible you will pay more into the policy than your family receive upon your death. Also, due to the ‘fixed sum’ nature of the payout, the real value of the amount will also be reduced by inflation.
Premium capping
There are some over 50s policies out there which allow customers to cap their premiums. This guarantees that individuals who maintain their payments will never pay in more than is received upon their death.
Premium capping may mean that you pay slightly more in your monthly premium; as a result, other non-capped over 50s plans may be cheaper. However, it is important to remember that this may mean you pay more into the policy than you get out. Regardless of this fact, your dependents will still receive a guaranteed amount of money to help protect their financial future.
