Is over 50s Life assurance worth it

JustFairPlay

Hope you can steer me through this dilemma, having looked at the over 50s policies on offer they all have some areas of failure in my humble opinion. Either the policy is void if you accidentally miss a payment or the pay out are really minimal for what your expected to put in, and your not covered by some for as long as two years post setting up.

Basically my question is, if i was able to put the equivillent of the payout amount in an ISA say stocks and shares, this would hopefully grow and I can draw dow from it at anytime and its tax free. This appears to my simple mind like a much better option. Your views would be greatly appreciated

TELLIT01

The reasons you have stated are all good reasons not to take out such a policy.  Unless you pop your clogs very shortly into the period of full qualification, there is a real probability that you will pay in more than it will ever pay out.

Sandtree

Over 50s policies are intended to be the last resort option however due to the free parker pen or carriage clock some people go to them before exhausting the normal underwritten policies which can be a much better option if you dont have health issues etc

dunstonh

Over 50s plans are the option of last resort for people that cannot get proper life assurance.   

Either the policy is void if you accidentally miss a payment

It's difficult to accidentally miss a payment as it will come out of the bank on the same date each month.

or the pay out are really minimal for what your expected to put in, and your not covered by some for as long as two years post setting up.

That's because they are generally taken out by people that cannot get conventional life assurance and have a short time to live .Plus they are cross-subsidised by those that don't realise that over 50s plans are totally unsuitable for the majority of people and end up paying for years when they could have had something much more suitable.

JustFairPlay

Thank you all very much for replies, which sort of confirmed my own thoughts. But what about the option I proposed of an ISA as a sort of tool to help pay at ones demise whilst still having a tax free pot to pull down from if you wish

Sandtree

JustFairPlay said:

Thank you all very much for replies, which sort of confirmed my own thoughts. But what about the option I proposed of an ISA as a sort of tool to help pay at ones demise whilst still having a tax free pot to pull down from if you wish

Have you had quotes for regular life insurance and been declined on received unacceptably high premiums? Did you go via an advisory whole of market broker or a tied agent/direct?

Aretnap

JustFairPlay said:

Thank you all very much for replies, which sort of confirmed my own thoughts. But what about the option I proposed of an ISA as a sort of tool to help pay at ones demise whilst still having a tax free pot to pull down from if you wish

As with all forms of insurance, whether you get a benefit from it depends on whether the event you are insuring against happens. If your house didn't burn down this year, you would have been better off in hindsight not insuring it, and putting the money in the bank instead. It doesn't follow that not insuring your house and putting the equivalent of the premium in an ISA every year will always be a good idea.

By the same token, if you live to a hundred then yes, saving money instead of buying life insurance will benefit you (or rather, your heirs). On the other hand if you die next month there will be nothing in the ISA, and your heirs would have been better off if you'd bought life insurance.

Take a step back: why do you think you need life insurance? Do you have people who are financially dependant on you who would be unable to cope in the event of your early demise? Are you worried about debts or funeral expenses? Do you just think it would be nice to leave a bit of money to your relatives? How old are you and do you have any health conditions which affect your life expectancy? The answer to those questions influences whether you should be thinking in terms of life insurance or savings.