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Learn more about  AARP Life Insurance

Before giving AARP life insurance a moment’s thought, know this: You can’t buy more than $100,000 in term coverage or over $50,000 for permanent (the type of insurance with cash-value savings). Rates for term insurance — sold to AARP members age 50 to 74 — are guaranteed for five years. When the term ends, you can continue coverage at whatever new rate the company imposes without reapplying. The insurance also lets a policyholder who is diagnosed with a terminal illness and has a life expectancy of 12 months or less access half the benefit before death. This latter feature offers some assurance that you’ll have the cash to cope with unexpected medical or other costs, if needed, at the end of your life. Click here for Rate Guide. You maybe able to get a 20 or 30 year guarantee rate with other Top rated Insurance Companies even if you have Diabetes ,Blood pressure or other Medically controlled conditions. Click here to apply  for a free Insurance Rate Analysis

AARP permanent life — for members age 50 to 80 — is paid in full at age 95. At that point, you can stop paying premiums but your coverage will continue for life. Permanent insurance is a poor choice for people over 50, however, says Gary Schatsky, president of ObjectiveAdvice.com and a New York-based fee-only financial planner. “For most people that age, there are better ways to save,” says Schatsky. “And term insurance could pay your estate tax bill for less money.”

The most enticing part, if you’re over 50 and want to buy term insurance: You can apply for an AARP policy without getting a physical exam or medical tests. AARP has what you might call a modified “don’t ask, don’t tell” approach.

An applicant must generally answer a few simple health questions. If you’re buying a $50,000 policy, you only need to say whether in the past two years you’ve been treated or diagnosed for heart trouble, a stroke, cancer, lung disease, or diabetes or have been hospitalized or institutionalized. You’ll also need to note whether you had any medical treatments or diagnostic tests in the past three months. So, a heart bypass surgery five years ago won’t count against you. And if you had a hip replaced in the past two years, you’ll probably be approved if you’re otherwise healthy. Smokers and drinkers are welcome, as are scuba and skydivers. (A $100,000 policy includes a few more questions and goes back five years.)

By contrast, most life insurers have tough underwriting standards that may include dozens of questions about your health over the past 10 years, an inventory of your prescriptions, your driving and credit records, risky hobbies, your weight and blood pressure, plus blood and urine samples. And insurers tend to be very leery of risk takers like scuba divers and sky divers. So, if you’ve been turned down by other insurers or fear you would be, you’re likely to find the AARP standards suit you well. Nearly 80 percent of applicants for AARP term insurance are approved, for example.

Cost of Convenience

AARP’s convenience, however, comes at a cost. “If you compare the policies to insurance with more comprehensive underwriting, they’re more expensive,” concedes Hisey. A 55-year-old woman buying a $50,000 AARP term policy might pay $671 a year for five years and then $1,034 a year for the next five years. If she was in excellent health, she could get double the coverage for $205 per year (rate guaranteed for 10 years) from other Top rated Insurance companies.

“I don’t know why anyone who could pass traditional underwriting would be interested in AARP’s product,” says Sheryl Moore, founder of AnnuitySpecs.com, a Des Moines firm that provides research on annuity products. But, Moore cautions, “not everyone can pass traditional underwriting.”