Can You Buy Life Insurance on Your Parents?


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ByMelissa Wylie
Edited byRae Osborn
Contributions by6+ experts
ByMelissa Wylie
Edited byRae Osborn
Contributions by6+ experts

Updated: June 16, 2024

Advertising & Editorial Disclosure

Buying life insurance for your parents can serve multiple financial planning objectives. One primary reason is to cover burdensome end-of-life expenses, such as a funeral. Additionally, a policy can act as an income replacement for family members who depend on your parent's financial support.

You can buy life insurance for your parents, but you need their consent and involvement. In this arrangement, you would typically be the policy owner, while your parents would be the insured individuals.

As the policy owner, you are responsible for paying the monthly premium and making any changes to the policy. You will also receive the death benefit. Some families opt for shared financial responsibility, where multiple siblings contribute to the premium payments. As the insured, your parents will need to undergo any required medical exams and provide personal information for the application.

Key Takeaways

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You can buy life insurance for your parents with their consent as long as you meet the insurer's requirements.

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Life insurance can help cover end-of-life expenses for your parents and can be a valuable tool for estate planning.

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The right policy for your parents depends on their budget, health, age and other factors.

How to Get Life Insurance on a Parent

To purchase a life insurance policy for your parents, or take out a life insurance policy on anyone else, you need their consent. You'll also need to prove that you have an insurable interest, which means you have a financial stake in the matter and will be impacted financially in the event of your parent's death. Sometimes, it may be easier to help your parents take out a life insurance policy and list you as a beneficiary instead.

Here's how to navigate this important financial decision:

1
Initiate a Conversation

The first step is to talk openly with your parents about the need for life insurance. Make sure they understand the purpose and benefits, as their consent is mandatory.

2
Establish Insurable Interest

Before proceeding, ensure you have an insurable interest in your parents' lives. This means you would face financial loss or hardship upon their passing. Insurable interest is a legal requirement for buying life insurance on someone else.

3
Assess Financial Needs

Evaluate what financial obligations or gaps the insurance policy should cover. This could range from funeral expenses and medical bills to providing an inheritance for grandchildren. For instance, if considering end-of-life expenses, burial life insurance for parents might be an appropriate choice.

4
Review Health Status

A medical exam is often necessary for life insurance policies. Knowing your parents' health status will help you understand what kind of policy they may qualify for and how much it would cost.

5
Research Life Insurance Policies for Parents

Shop around and gather quotes from multiple providers to get a sense of the market rates for the coverage you're seeking. Look for policies that align with your parents' needs and financial situation. Consult an insurance broker or financial advisor if you need help navigating the complexities of choosing the right policy.

6
Choose a Life Insurance Policy

After thorough research, select a policy that best suits your parents' needs. Pay attention to the premium costs, coverage amount and any exclusions or limitations.

7
Complete the Application

Fill out the application form, which will require personal and medical information about your parents. They may also need to undergo a medical exam.

8
Review and Finalize

Once the application is processed and approved, review the policy details one final time to ensure that all the terms are clear and agreeable.

9
Pay the Premium

As the policy owner, you'll be responsible for paying the premiums by yourself or in collaboration with other family members.

By incorporating these steps, you'll ensure that the process is ethical and adheres to the insurer's requirements.

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Cost of Life Insurance for Parents

When considering life insurance for your parents, understand that age plays a significant role in determining the cost. Generally, life insurance premiums increase as someone gets older. Life insurance for parents over 65 tends to be pricier than plans for parents in their 30s due to higher risk factors.

For example, a 10-year term policy with $250,000 in coverage averages around $45 per month for a 50-year-old. However, that same policy can cost an average of $243 per month for a 70-year-old.

Beyond age, several other factors can influence the cost of life insurance for older adults:

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    Health Status

    Pre-existing conditions or a history of illness can drive up premiums.

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    Lifestyle Choices

    Smoking or high-risk activities can also affect costs.

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    Policy Type

    Whether it's term, whole or universal life insurance, each has its own pricing structure.

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    Coverage Amount

    The higher the death benefit, the higher the premium.

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    Payment Frequency

    Whether you opt for monthly, quarterly or annual payments can slightly alter the overall cost.

The table below breaks down how costs differ by age, coverage amount and term limits to give you an understanding of what to expect.

Data filtered by:Results filtered by:
Coverage Amount:
Coverage Amount:$250K
5010-Year Term$ 4520-Year Term$ 64
6010-Year Term$ 9120-Year Term$ 164
7010-Year Term$ 24320-Year Term$ 752

How to Set Coverage Levels for Your Parents

Determining the right amount of life insurance coverage for your parents can help ensure that the policy covers funeral expenses, medical bills and possibly an inheritance or donation to an important cause. Underestimating the needed coverage, especially for life insurance for elderly parents, could leave your family with financial burdens, while overestimating could result in unnecessarily high premiums.

To accurately gauge how much life insurance your parents need, consider the following steps:

  1. Tally up any outstanding debts, mortgages or loans you would need to pay off in the event of your parent's passing.
  2. Factor in the costs of a funeral and any end-of-life medical care.
  3. If your parents are still working or providing financial support to dependents, calculate how much income would need to be replaced.
  4. If leaving an inheritance or making charitable donations is a priority, add that to the total.
  5. Include a buffer for unexpected expenses or emergencies.

Once you've gathered this information, you can use it to choose a policy that aligns with your parents' needs and financial goals. The right amount of coverage is a balance between adequate financial protection and a premium that fits comfortably within your budget.

How Much Life Insurance Do You Need?

Answer three simple questions to get your recommended coverage amount.

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Why Buy Life Insurance for Your Parents

Life insurance for your parents offers financial security and reassurance for your family in case of their passing. You might consider it for funeral expenses or debt settlement, amongst other reasons:

  • Funeral Expenses: Funerals can be costly, but life insurance eases this financial burden during challenging times.
  • Debt Settlement: If your parents have debts like mortgages, loans or credit card balances, life insurance can clear these, preventing their transfer to the family.
  • Income Continuation: If your parents contribute to the family's income, life insurance can replace their earnings, ensuring financial stability.
  • Estate Planning: Life insurance aids asset distribution and provides an inheritance for beneficiaries.
  • Charitable Giving: If your parents support a charity, life insurance can fund a legacy donation.
  • Final Expenses: Beyond funerals, life insurance can cover medical bills and legal fees.

Consider how these reasons may apply to you and your family and how a life insurance policy could help ensure financial stability.

Types of Life Insurance to Buy for Parents

Choosing the right type of life insurance for your parents involves weighing their financial needs, health status and long-term objectives. Each policy type has pros and cons, so take the time to assess which best aligns with your family's goals.

Term Life Insurance for Parents

Term life insurance is straightforward and often the most affordable option. It provides coverage for a specific period, usually 10, 20 or 30 years. If your parents are in relatively good health and you're looking for a cost-effective way to provide financial security for a set period, term life could be a good fit. However, keep in mind that once the term expires, the coverage ends, and a new policy will likely come with higher premiums due to increased age. This type of policy may be particularly suitable if you are considering buying life insurance on parents over 60. Term life insurance for elderly parents offers a cost-effective way to cover specific financial responsibilities like debts or to provide an inheritance during their most vulnerable years.

Whole Life Insurance for Parents

Whole life insurance offers lifetime coverage and includes a cash value component that grows over time. This type of policy is more expensive than term life but can serve as both a financial safety net and an investment vehicle. If your parents want to leave a legacy or accumulate cash value for future needs, whole life insurance might be the right choice. For those considering a lifelong coverage option, whole life insurance for parents provides a safety net and can be seen as an investment.

Universal Life Insurance for Parents

Universal life insurance is a flexible option that combines the lifelong coverage of whole life with the potential for higher earnings on your cash value. It allows for adjustments to the premium and death benefit, offering a level of flexibility that can be beneficial for changing financial situations. However, the investment component comes with risks, and poor market performance can affect the cash value.

Final Expense Insurance for Parents

Also known as burial insurance, final expense insurance is designed to cover end-of-life costs like funeral expenses. Burial life insurance for parents usually offers lower coverage amounts, making them more affordable but limited in scope. If your primary concern is to relieve your family from the financial burden of funeral costs, this could be a suitable option.

This type of insurance is also especially relevant when considering life insurance for elderly parents as it directly addresses the costs associated with their passing, ensuring that these inevitable expenses do not create financial stress for the family.

Best Life Insurance Options for Parents

Age is also critical when selecting the most suitable life insurance policy for elderly parents or those in different age brackets. The right type of insurance can vary significantly depending on the age group, as insurance needs and financial responsibilities evolve over time.

Younger Parents (Ages 25-40)

For younger parents, who may be in the early stages of family life and facing significant financial obligations like mortgages or young children's education, term life insurance is often the best choice. It provides substantial coverage at an affordable cost for a specific period, matching the duration of their primary financial responsibilities.

Middle-Aged Parents (Ages 40-60)

As parents enter their middle years, their financial focus may shift towards saving for retirement or supporting older children through college. This age group might benefit from whole life insurance or universal life insurance, which provides lifelong coverage and builds cash value that can be a beneficial financial resource later.

Parents Over 60

For parents over 60, especially those considering how to manage their estates or leave a legacy, whole life insurance or final expense insurance are suitable options. Life insurance on parents over 60 often focuses on managing end-of-life expenses and ensuring financial ease for their beneficiaries, which makes final expense insurance for parents particularly relevant. These policies ensure that their passing does not financially burden the family while providing a fixed coverage that remains constant irrespective of future health changes.

In each case, choosing the best life insurance for aging parents or those in younger age brackets involves considering both immediate and future financial needs and ensuring the coverage aligns with these priorities.

Where to Get Life Insurance Quotes for Your Parents

Securing a life insurance policy for your parents can be straightforward if you know where to look and what to consider. Various avenues are available for purchasing life insurance, each with its advantages:

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    Insurance Agents and Brokers

    Working with an insurance agent or broker can offer personalized guidance. Agents usually represent a single insurance company, while brokers work with multiple insurers, giving you a broader range of options.

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    Online Platforms

    Many insurance companies offer online quotes and even the ability to purchase policies directly through their websites. This option provides convenience and speed but may lack the personalized advice an agent or broker can offer.

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    Financial Advisors

    Consulting a financial advisor can provide a holistic view of how a life insurance policy fits into your parents' overall financial plan.

Tips When Shopping for Life Insurance

Regardless of your choice, consider the following tips when shopping for the best life insurance for your parents to ensure you get coverage that provides financial security for your family.

  • Read the Fine Print: Examine the policy details, including exclusions, life insurance riders and the flexibility to change coverage or beneficiaries.
  • Check Financial Stability: Look for insurers with solid financial ratings indicating their ability to pay claims.
  • Consult Reviews: Customer reviews and testimonials can offer insights into an insurer's customer service and claim processing times.

By consulting the available information, you can make an informed choice about the life insurance policy you buy for your parents.

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FAQ: Buying Life Insurance for Your Parents

Purchasing life insurance for your parents can be a different experience than getting a policy for yourself, likely leading to some questions or concerns. We've addressed a few common issues to help simplify the process for you.

Can you buy life insurance for your parents?
Can I buy a life insurance policy for a family member?
Should you get life insurance for your parents?
What life insurance should you get for your parents?
Can you pay for your parents' life insurance if you don't own the policy?
Can you buy life insurance on a parent without their consent?
Is life insurance for parents over 40 a good idea?
What is the best life insurance for parents over 60?
Why should I consider life insurance for parents over 65?
What are the benefits of term life insurance for elderly parents?
Can I buy burial insurance for my parents?
How can life insurance serve as an investment for aging parents?
At what age does life insurance not make sense?

Expert Advice on How to Get Life Insurance for Your Parents

  1. What factors should one consider when comparing rates and deciding on a life insurance policy for their parents?
  2. How do you determine how much life insurance is needed for their parents?
  3. Is there a certain age at which purchasing life insurance may not be beneficial or cost-effective? How should individuals approach this?
Jamieson Hopp, CFP®, ECA
Jamieson Hopp, CFP®, ECAFinancial Planner at Millenial Wealth, LLC
Aaron Rubin, JD, CPA, CFP®️
Aaron Rubin, JD, CPA, CFP®️Partner at WRP Wealth Management
Nadia C. Vanderhall
Nadia C. VanderhallFinancial Planner and Educator at The Brands + Bands Strategy Group
Dr. Robert W. Tiller
Dr. Robert W. TillerCourtesy Assistant Professor at the University of South Florida DBA Program, Retired USF Personal Financial Planning Program Director
Sandra D. Adams, CFP®
Sandra D. Adams, CFP®Lead Financial Planner/Partner at The Center for Financial Planning, Inc.
Paige Mabry
Paige MabryWealth Advisor at Hemington Wealth Management
Mahalene Dulay
Mahalene DulayFounder and Wealth Advisor at Modern Wealth Collective®
Matt Hylland
Matt HyllandFinancial Planner at Arnold & Mote Wealth Management
Mark Kenney, CFP®, CTS™
Mark Kenney, CFP®, CTS™Certified Financial Advisor at SHP Financial
Joshua Frederick
Joshua FrederickAssistant Professor of Finance at Georgia Southern University
Hanna Morrell
Hanna MorrellHolistic Financial Coach at Pacific Stoa Financial Wellness
Brian C. Payne, Ph.D.
Brian C. Payne, Ph.D.Associate Professor of Finance, Banking and Real Estate at University of Nebraska Omaha

About Melissa Wylie


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Melissa Wylie is a Content and SEO Manager at MoneyGeek. Melissa has worked in the financial content space since 2018 and has spent much of that time focused on all things small business.

Prior to joining MoneyGeek, Melissa held SEO positions at Bankrate and LendingTree. Melissa’s work has also appeared on LendingTree-owned websites ValuePenguin and MagnifyMoney.

Melissa began her career at American City Business Journals in 2015 as a reporter for the company’s women-focused publication Bizwomen. Melissa has a Bachelor of Arts in Journalism from the University of North Texas. Melissa relies on her foundation in journalism to craft content that simplifies complex financial topics to help everyone feel confident when making decisions with their money.

Melissa's other work can be read on LendingTree and Bizwomen.