Tag Archives: over 50s insurance

List of Recommended Over 50s Insurance

Here is our list of recommended Over 50s Insurance Companies.

Over 50s insurance always was sold to pay for funerals.  Then a few people started to point out that it was pretty useless for that purpose.   But still 500,000 buy 50 plus insurances every year for that very reason – because they don’t understand how it works. We have said it before, and so has Martin Lewis – Over 50s Insurance is an awful product.

As Martin points out, the main beneficiaries of 50+ Insurance are the insurance companies. Why?

  1. If you don’t keep up the payments (typically until you are at least 85) – they keep all your money.  That could be ten or fifteen years at (say) £20 a month down the tubes.
  2. The non-profit whole of life plans are not set up to keep up with inflation.  You will get exactly what was agree on day one if you die 20 years later. The provider may well come back to you every year or
  3. By that time you are pretty certain to have paid in far more than your family will get back. So you have lent them your money, interest-free, for 20 years or so, then they give MOST of it back, as long as you don’t miss more than one or two payments while you are quietly expiring.
  4. In order for you to “keep up with inflation,” they will keep trying to sell you top up plans of the same awful Over 50s Insurance your have already bought

Over 50s Insurance and Inflation.

With funeral cost inflation running way ahead of normal inflation, in 5 years your 50 plus insurance may be worth one third less than it was when you set it up.  In ten years, less than half the value.  At the same time, the cost of the actual funeral, at recent rates of inflation, would have more than doubled!

That is why we do not have a list of recommended Over 50s Insurance – we recommend it only as a last resort to folk who cannot afford even the most basic of prepaid funeral plans.

Express Crusader on Over 50s Insurance

The Daily Expresses Crusader lays into Over 50’s “Funeral” Insurance Plans

Funeral Plan Quotes

Funeral Plan Quotes

Over 50s Insurance plans are the same, but many insurance based “funeral” plans can prove to be appalling value for money.  Here is a little of what the Crusader had to say (or read the whole article) followed by our recommendations.

“Funeral plan costs: Beware paying more than you will get back

Ageing parents by-and-large prefer not to rake over plans they made years ago to cover their funeral costs.
But their decisions can look very different to their offspring.

Two complaints to Crusader reveal the outrage adult children can feel on discovering how much their mum or dad is paying for a plan compared to the final sum due.

Paul W’s parents signed up to a policy 17 years ago when they were in their early 50s paying £30 a month. So far they have contributed over £12,000 but each plan will only pay £2,240 each when they die.

Andrew S’s mum Joan is in a similar position in that she agreed to a £10-a-month plan after his dad died in 2000.  Now 84 she cannot remember whether she saw an ad and contacted a company, or she was cold-called, but the sale involved a phone conversation after which she was sent papers that she signed and returned.

Joan has contributed £1,800 and when she dies it will pay £1,280.

If Paul’s parents or Joan cancel their premiums, all benefit is lost.

The terms are fixed too.

The policies’ descriptions, “whole-of-life, non-unit linked” mean little to the holders and scarcely more to their children who, perhaps understandably from their parents’ perspective, were not part of the decision-making.”   We at the Prepaid Funeral Review agree wholeheartedly with the Crusaders verdict on Over 50s Insurance.

We believe that a proper prepaid funeral plan is the best:

At the Prepaid Funeral Review, we strongly believe that a proper prepaid funeral plan is the best way to go if you can possibly afford it.   With starter plans available for less than £20 a month, most families can afford to start making at least some provision for a family funeral.  The beauty of that particular plan is that it can be used when any member of the family dies, so it is fully transferable.   It is not designed to pay for everything, but it will make a darn good contribution, and substantially cut the cost and worry to those left behind.

Buying Over 50s insurance may result in your paying in more than your family get out (never mind inflation) or losing the lot if you miss payments.  Prepaid plans are much better in every respect than poor value Over 50s life insurance.

Why not contact us today and find out more?

Life Insurance Funeral Plans (Over 50 Plans)

Life Insurance Funeral Plans (or Over 50 Plans)

Funeral Life Insurance plans (or over 50 plans)  are widely advertised on TV, in magazines and direct mail.  They look good for older people as a medical or medical evidence is not required before taking one out so your health and age don’t matter.

But if you watch or read carefully you will find that

Over 50s Life Insurance is NOT Suited for Funeral Planning.

Funeral Plan Quotes

Funeral Plan Quotes

Life insurance funeral plan policies accept all comers, which can be a plus or a minus.   Clearly, premiums will be higher than for a properly underwritten life insurance policy, and you wouldn’t have the problem that you have to live for two years (generally) after the plan has started before it will pay out.

Since you pay premiums until you reach a certain age (typically 85 or 90 – sometimes until you die), those in good health are effectively subsidising those who are not so fit

If you live too long, life insurance funeral plans can be poor value as it may not pay out as much as you’ve paid in!  On the other hand, if you die too soon it may not pay out at all.

There are two other aspects to review with life insurance funeral plans.

  1. Admin charges can take out a large proportion of small monthly premiums, making them worse value.
  2. Most life insurance plans pay out a set amount, which may be fine NOW, but could be woefully inadequate in 10 or 20 years time.  At current levels of funeral cost inflation, costs will double in around 10 years, and be FOUR times as much in twenty years.  If you pay for thirty years, funeral costs could have risen to EIGHT times the current cost.  So we strongly recommend considering a proper prepaid funeral plan if you possibly can.
  3. You will lose everything you have paid in if you no longer pay premiums – perhaps through a bank error, or because you are ill or just can no longer afford the premiums.  That could be thirty years worth of savings – gone.  Is that fair? Is it a risk you want to take?  That doesn’t happen with prepaid funeral plans.

But I already have a Life Insurance Funeral Plan!

We don’t suggest that you should cash it in, as if it is the type of plan we are describing here, you’ll get nothing back,   But what you could do is use it to provide the extras that a basic (relatively inexpensive) prepaid funeral plan doesn’t.  So contact us to add a proper funeral plan to the life insurance one.

We believe the best safeguard is to choose a pre-paid funeral plan from a company, ideally approved by the Funeral Planning Authority. This has a code of practice that members agree to and ensures that your money is held separately in a trust fund which is absolutely crucial.   You can usually add in a choice of extras to cover parties, coach and horses or whatever you wish too as well!

The crucial part of using an approved firm is that your money is kept in a TRUST, which protects it should the undertaker or pre-paid funeral plan firm go out of business, so your hard won savings won’t be lost.

Naturally, if you have a decent amount of savings, you can state in your will that they must be used to pay for your funeral which is one way try to ensure that your money is used as you would wish.  But be aware that directions to your executors in your Last Will are only regarded as being WISHES, and the executors can choose to ignore them.   A pre-paid funeral plan is a far better bet.  The life insurance funeral plans generally give you no real control at all over how your funeral is conducted.

So  we would generally recommend a pre-paid funeral plan

Life Insurance Funeral Plans (Over 50 Plans) – Prepaid Funeral Review