Life insurance for the oldies
As you get older, you’d expect your life insurance to cost more, wouldn’t you? After all, you’re going to die sometime and that time is bound to be getting closer.
Funnily enough, that’s not necessarily the case and for various reasons senior life insurance can be cheaper than normal insurance used for older people. The reason for this is down to complicated statistical effects that are far from obvious. Clearly we all know that the chances of dying are very high in infants thus there’s a major distortion in life expectancy from that angle. Thus, for example, the low average life expectancy in, say, some African countries doesn’t mean that once you clear your teens you’re only going to live to 50 or something: it’s very much skewed towards the young dying in large numbers.
Similarly, as you get towards the upper end of the age range, the older you are, the more likely you are to live a bit longer. Why this should be so is basically down to a whole raft of reasons: you’ve obviously passed the various childhood illnesses, you’re unlikely to be bungy jumping, and, less obviously, you’ve an element of luck (eg through not getting knocked down as you’ve crossed the road over the years).
Add that all up and you’ll generally find that getting a policy aimed at older people will usually be cheaper than continuing to use a normal policy as you get older.
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