One common limitation of life insurance policies for seniors is often being required to pay higher premiums at older ages and if you have a pre-existing medical condition. Term life insurance involves the major limitation of no death benefit payout if the policyholder survives the term period of the coverage.
Some life insurance policies for seniors also may limit the amount of coverage based on age and health conditions. Some common exclusions — situations that preclude beneficiaries from collecting the death benefit — of specific life insurance policies for seniors may include suicide, death while engaged in illegal or criminal activity, dangerous activities (e.g., skydiving, flying a private plane or race car driving), alcohol/drug abuse and death resulting from war or a terrorist attack.
Misrepresentation, another common exclusion, occurs when the policyowner dies within two years from the policy's effective date, and the insurer reviews the application form and identifies significant inaccuracies when compared with the policyholder's medical records — invalidating the policy.