Forum Home» Insurance & Life Assurance

Over 50s Life Insurance Plans Guide Discussion - Page 3

New Post Advanced Search

Over 50s Life Insurance Plans Guide Discussion

edited 30 November -1 at 1:00AM in Insurance & Life Assurance
71 replies 29.9K views
135678

Replies

  • Is it legitimate to take out these plans if you have been diagnosed with a terminal illness? I've read the ts&cs, and the MSE guide that says they can be lucrative if you play the odds (and live past the minimum qualifying period of 12 - 24 months), but it just seems a bit too good to be true, and not 'in good faith'.

    My late wife Isobel was diagnosed with terminal cancer in 2009, at the age of 52, and given 2-3 years to live. Over the next year she took out a total of eight policies, one with each of the major life companies in this field, with premiums totalling ~£400 per month, and a total sum assured of just over £160,000. In fact she survived to age 56, and when she died I was able to claim successfully on all of the policies. We were able to do this because we had both worked in the life and pensions industry, and had studied the policy details very carefully. The qualifying period is designed to weed out most people with a terminal diagnosis, but even if the assured dies within this period, there is generally no loss, since there is always a guaranteed return of premiums, sometimes more. These companies make so much money out of the people who are being warned against the use of these policies, that they can afford to stand the loss created by the small numbers of people like Isobel who effectively "select against the insurer", to use the trade term (kind of like betting on a certainty).

    If you are relatively young (over 50 of course) and have a terminal diagnosis, then this is a great way to help your surviving spouse or family. There is no catch, and you will not be acting in bad faith. You will have the bonus of putting one over on the insurance industry, though that is small compensation for the loss of life. If by great good fortune you survive and are declared "cured" (very unusual, though remission is more common), then you will have wasted your premiums, but will no doubt be thankful to be alive. Take care about cancelling if you are only in remission.

    Cheers,

    Colin.
  • We have just taken out a policy based on exactly the same decision making process as Colin. My husband is 53 and in very poor health, although he doesn't yet have a terminal diagnIsis. We've now got a policy from Royal London, which will pay out the maximum amount of just under £25000 if he dies after one year. If he dies before then they will give us 1.5 times the premiums we have paid. That's a great deal better than any savings scheme. In our situation it's definitely worth thinking about
  • I'm sure I read somewhere that people who go into a care home with local authority funding have all their income taken to fund their care apart from a small personal allowance of £23. Life insurance payments are not considered an allowable expense, so people without savings are forced to stop paying their premiums when they go into care. A pre-paid funeral plan, on the other hand, is an allowed expense.
  • Very useful, how about the British seniors plan, they pay out all monies paid in regardless of how long you live!!
  • dunstonhdunstonh Forumite
    102.1K posts
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    ✭✭✭✭✭✭
    Williams18 wrote: »
    Very useful, how about the British seniors plan, they pay out all monies paid in regardless of how long you live!!

    Again, an option of last resort. Underwritten life assurance is better value for money. As long as your health does not make life assurance too expensive or a rejection. over 50s life insurance plans should only be used where life assurance is not an option.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • JLW07JLW07 Forumite
    1 posts
    I've come across the British Seniors Guarantee - New Lifetime Payback Guarantee which, as it states, guarantees to return the amount you've paid in.

    Not sure whether to believe the hype - has anyone else heard of this policy?
  • rs65rs65 Forumite
    5.6K posts
    Ninth Anniversary 1,000 Posts Name Dropper Combo Breaker
    ✭✭✭✭
    JLW07 wrote: »
    I've come across the British Seniors Guarantee - New Lifetime Payback Guarantee which, as it states, guarantees to return the amount you've paid in.

    Not sure whether to believe the hype - has anyone else heard of this policy?

    See the post 2 before yours.
  • Pablo_BanezPablo_Banez Forumite
    3 posts
    First Post
    MoneySaving Newbie
    So what is the answer, both my wife and i havent any life insurance and we are both in our late 50s. If these plans are such poor value what is the answer to cover for anything happening.
    Plenty of negatives, but no positives
  • dunstonhdunstonh Forumite
    102.1K posts
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    ✭✭✭✭✭✭
    So what is the answer, both my wife and i havent any life insurance and we are both in our late 50s. If these plans are such poor value what is the answer to cover for anything happening.
    Plenty of negatives, but no positives

    Take out a normal life assurance plan (typically a term assurance but some may have a whole of life assurance need). These are better than the over 50s life insurance.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Pablo_BanezPablo_Banez Forumite
    3 posts
    First Post
    MoneySaving Newbie
    dunstonh wrote: »
    Take out a normal life assurance plan (typically a term assurance but some may have a whole of life assurance need). These are better than the over 50s life insurance.

    So, how many years would you suggest? and which company?
Sign In or Register to comment.

Quick links

Essential Money | Who & Where are you? | Work & Benefits | Household and travel | Shopping & Freebies | About MSE | The MoneySavers Arms | Covid-19 & Coronavirus Support