While many seniors, or Boomers, as I like to call them, dismiss out of hand pursuing the purchase of life insurance even if they fully recognise the need for having some or more protection. Many fully recognize that life insurance provides access to instant tax free cash when financial liabilities come to the fore and that’s at death. The needs are wide and varied by the individual. Things lake last expenses; bill payments (credit cards lines of credit etc.); capital gains taxes on investments and cottage or condo; property taxes, taxes on unused RRIF funds, legal fees, legacy for children or grandchildren’s education are but just a few examples. While death is inevitable, its timing is rarely predictable and many of these liabilities are immediate and liquidating many assets in untimely fashion often results in fire sale valuations.
Our non-scientific research has shown that there are 4 core reasons that Boomers dismiss the notion of purchasing life insurance at their age:
- I’m too old;
- I wouldn’t qualify;
- It’s too expensive;
- I don’t want to answer a bunch of personal questions from high pressure salesperson or undergo medical and other silly tests.
Let’s address these concerns individually.
1. I’m too old.
You may be surprised to know that some insurance companies offer life insurance up to age 85. So if you are under age 85 and a half, you are eligible to apply.
2. I wouldn’t qualify.
The selection process has become quite sophisticated recognizing the reticence of Boomers to undergo rigorous scrutiny and numerous companies have plans that pre-price health issue into the rates thus minimizing the scrutiny process. Many of my Boomer clients were pleasantly surprized how unobtrusive the process was in successfully obtaining life insurance.
3. It’s too expensive.
While on the surface the price is not surprisingly substantial. That being said, many Boomers were surprised, and in some cases shocked at how much more expensive the final expenses turned out to be and the final value of their estate would have been decimated and in other cases debts left with family if the life insurance had not been put in place. A qualified advisor can quickly demonstrate the comparative outcomes with or without life insurance.
4. I don’t want to answer a bunch of personal questions from high pressure salesperson or undergo medical and other silly tests.
This reticence is by far the most prevalent and often comes from two sources. Past encounters with inexperienced commission driven salesperson focussing on the sale and not on problem solving. That’s happened to me and I share the sentiment. Second is the notion of many personal questions from a stranger or medicals from unfamiliar medical personnel. Let’s take these individually.
Technically you do not need to see anyone to successfully acquire life insurance at a mature age. On the other hand, a qualified advisor who has experience in the Boomer market can be invaluable in successfully negotiating the acquisition of the right product at the right price. So what’s a qualified adviser. Having the product knowledge and the access to the products in the marketplace is a given. In addition, someone who can explain in plain lay terms the cost benefit of life insurance in your specific circumstance, if it exists. At times, the status quo, makes more sense and your “gut feel” is ratified. Secondly the qualified advisor can walk you through the qualifying processes of the various products, the price consequences of your preference and the value proposition that results in your specific circumstance.
With respect to personal questions, the more detail an applicant provides the better job the insurer can do in giving you the best price. A qualified adviser cans sense and applicant’s reticence to answer potentially sensitive questions and can handle them quite delicately. Often, the first response to a given question like “Have you ever had bla, bla, bla” that is being sought is a yes or no. If its no you move on to the next question. If its “yes” the follow up questions are “when”, “what” , “outcome” and name of doctor. To satisfy the reticence, the applicant can just answer, the details can be obtained from Dr So and So. The insurer will then obtain details from the doctor.
All of the costs associated with the qualification process is at the expense of the insurer.
In summary, the reality is that with the baby boomer demographics is in full swing, life insurance at the older ages have become more in demand and insurers are responding with client centric products at this older age group. It’s available up to age 85 from guaranteed issue without any questions, to a few questions and all the way up to full selection and categorization with a compelling value proposition.
We are in a position to help you wade through a list of products that are geared for the mature seniors market including the widely advertized CPP ~