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6 things you should know about insurance for retirement

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Your insurance needs change throughout your life, especially after you retire

Retirement is a chapter of life that you may be looking forward to but also have questions about. One area that usually puzzles retirees is insurance coverage. You may wonder, “Do I need more insurance than Medicare?” or “What are the average health care expenses for retirees?” To help get you started, here are six things to know about health and life insurance after retirement.

1. Car insurance 

Car insurance is the first type of insurance that you should look into amending. Your age may make you eligible for a discount, and your needs will be changing, like commuting less. Inform your insurance provider that you’ve retired and you’re looking for coverage and/or a discount to better support your next chapter. Your provider may allow you to qualify for discounts if you can be identified as a safe mature driver. That may include taking a defensive driving course.

2. Travel insurance 

If you’re planning on traveling for long periods of time during your retirement, you should look into travel insurance. Travel insurance helps to protect the money that you’ve invested into your trip, no matter what unforeseen circumstances pop up. When selecting travel insurance, make sure to research your options, rather than relying on a default option that is presented during a booking. Consider the distance from home that you’ll be traveling, as well as the potential for injury or sickness. (Keep in mind, most U.S. health plans, including Medicare, typically offer limited, or no, coverage outside of the country.)

3. Home insurance 

Some homeowner’s insurance companies offer discounts to customers after retirement because they’re home more often, which lowers the risk of people breaking into their homes, fires starting, and other problems. Keep in mind, if you have significant travel plans for your retirement, your homeowner’s insurance could be affected. Homes that are vacant for prolonged periods usually need an endorsement, which is an addition to your policy. 

4. Medicare and supplemental health insurance  

When you turn 65, you’re eligible for Medicare, the federal government’s health insurance plan for older adults. Medicare has four parts, A through D, which pay for hospital services, preventive care, prescription drugs, and more. However, Medicare doesn’t care cover everything, including long-term care, eye exams, routine physical exams, dental care. 

Supplemental health insurance can help fill the gaps between what’s paid by Medicare and the overall cost of health care treatments. Depending on your needs, several options are available:

  • Medicare Supplement insurance, a.k.a. Medigap, can help with copayments, deductibles, and coinsurance and can provide foreign travel emergency health care coverage when you travel outside the United States.
  • Dental insurance: Just like a crown or filling can help fill in the gaps, can help you restore the health of your teeth — while maintaining the strength of your savings. 
  • Hospital Indemnity insurance complements your existing health insurance by giving you cash to help with the costs your plan doesn’t cover for unexpected hospital stays.
  • First Diagnosis Cancer insurance’s lump-sum payment allows you to choose when and where to spend the money to cover direct medical expenses and indirect costs tied to a cancer diagnosis.

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5. Long-term Care insurance and Short-term Care insurance

Long-term Care insurance includes a range of services that help with personal care needs, such as bathing and eating. According to LongTermCare.gov, about 60% of people will need assistance with daily tasks at some point in their lives. For many cases, Medicare won’t pay for these services, so many older people need to save money for long-term care or rely on a life insurance policy that includes long-term care benefits

Short-term Care insurance can help if you’re unable to qualify for or afford Long-term Care insurance. Short-term Care insurance has fewer restrictions for qualification and types of care it covers. It’s commonly less expensive than Long-term Care insurance costs, and it provides benefit payments sooner. Considering many individuals with Long-term Care insurance only need care for less than one year, Short-term Care insurance just makes sense.

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6. Life insurance 

Buying a life insurance policy, even if you’re near retirement, is a smart decision because it can lessen the financial burden on your family. Each type of life insurance helps covers end-of-life expenses in different ways. Your situation and wishes will determine which plan will work best to keep you well prepared — and your family well protected. 

You’ll want to consider your health, income, and what you want the policy to do. If you only want to cover your funeral, a Preneed Funeral insurance plan may be what you’re looking for. If you’re looking to cover more end-of-life costs, a Final Expense insurance policy would be a better choice. Visit our “Differences among types of life insurance” page to determine which one is right for you. Or request a call from one of our agents to help you understand what would work best for you.

Photo credit: iStock

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Supplemental health plans

Understanding your insurance options in retirement

Kelly Rayburn, AVP national sales and distribution at Wellabe, and Olga Villaverde, from Lifetime TV’s The Balancing Act, discuss the areas that primary health plans and Medicare may not cover and how you can protect yourself with supplemental plans.

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Wellabe offers life and supplemental health insurance plans to help you prepare for good days and bad. We’ll always be here to empower you to be well — well prepared, well protected, and well loved.