Description
Senior and pre-need products
Insurance companies also offer products targeted at niche markets, such as seniors. These policies are often low face value whole life insurance policies, allowing individuals (ages 50-90) to purchase affordable insurance later in life. These may also be marketed as final expense insurance or burial insurance and usually have death benefits between $1,000 and $50,000.[citation needed] A major reason for their popularity is their use of “simplified underwriting”. With simplified underwriting, applicants are not required to take a medical exam; approval depends on the applicant’s answers to a set of “yes” or “no” health questions as well as a check of their prescription drug history.
Health requirements can vary substantially between exam and no-exam policies. It may be possible for individuals with certain conditions to qualify for one type of coverage and not another. [citation needed].
Pre-need life insurance policies are limited-premium whole life policies that are usually purchased by older applicants, though they are available to everyone. This type of insurance is designed to cover specific funeral expenses that the applicant has designated in a contract with a funeral home. The policy’s death benefit is initially based on the funeral cost at the time of prearrangement, and it then typically grows as interest is credited. In exchange for the policy owner’s designation, the funeral home typically guarantees that the proceeds will cover the cost of the funeral, no matter when death occurs. Excess proceeds may go either to the insured’s estate, a designated beneficiary, or the funeral home as set forth in the contract. Purchasers of these policies usually make a single premium payment at the time of prearrangement, but some companies also allow premiums to be paid over as much as ten years.
Specific references
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- ^ The Documentary History of Insurance, 1000 B.C.–1875 A.D. Newark, NJ: Prudential Press. 1915. pp. 5–6. Retrieved June 15, 2021.
- ^ The Documentary History of Insurance, 1000 B.C.–1875 A.D. Newark, NJ: Prudential Press. 1915. pp. 6–7. Retrieved June 15, 2021.
- ^ Fouse, L. G. (September 1905). “Policy Contracts in Life Insurance”. The Annals of the American Academy of Political and Social Science. 26 (2): 29–48. doi:10.1177/000271620502600203. JSTOR 1011003. S2CID 143550312. Retrieved 8 April 2021.
- ^ Walford, Cornelius (22 Dec 1884). History of Life Assurance (PDF). p. 6-7. Retrieved 8 April 2021.
- ^ Anzovin, Steven, Famous First Facts 2000, item # 2422, H. W. Wilson Company, ISBN 0-8242-0958-3 p. 121 The first life insurance company known of record was founded in 1706 by the Bishop of Oxford and the financier Thomas Allen in London, England. The company, called the Amicable Society for a Perpetual Assurance Office, collected annual premiums from policyholders and paid the nominees of deceased members from a common fund.
- ^ Amicable Society, The charters, acts of Parliament, and by-laws of the corporation of the Amicable Society for a perpetual assurance office, Gilbert and Rivington, 1854, p. 4
- ^ Amicable Society, The charters, acts of Parliament, and by-laws of the corporation of the Amicable Society for a perpetual assurance office, Gilbert and Rivington, 1854 Amicable Society, article V p. 5
- ^ Price, pp. 158–171
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- ^ Rothstein, 2004, p. 38.
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- ^ OECD (5 December 2016). Life Annuity Products and Their Guarantees. OECD Publishing. pp. 10–13. ISBN 978-92-64-26531-8.
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General sources
- Kutty, Shashidharan (12 August 2008). Managing Life Insurance. PHI Learning Pvt. Ltd. ISBN 978-81-203-3531-8.
- Oviatt, F. C. “Economic place of insurance and its relation to society” in American Academy of Political and Social Science; National American Woman Suffrage Association Collection (Library of Congress) (1905). Annals of the American Academy of Political and Social Science. Vol. XXVI. Published by A. L. Hummel for the American Academy of Political and Social Science. pp. 181–191. Retrieved 8 June 2011.
- Rothstein, Mark A. (2004). Genetics and Life Insurance: Medical Underwriting and Social Policy. MIT Press. ISBN 978-0-262-18236-2.
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