By the time people reach the age of 55 or so, it is not uncommon for them to have accumulated a number of possessions over the years. Everything from sets of dishes and furniture to clothes, old magazines and more may be tucked into closets and basements of many seniors’ homes.
The same is true for different types of insurance policies. In many cases, people will purchase a variety of insurance when they are younger and, like the items in their home, they may end up with a large number of policies by the time they are older. Does this sound like you? If so, you may want to start assessing your insurance needs and possibly eliminate some that are no longer needed.
First, the Necessary Policies
Granted, there are certain types of insurance that everyone should have regardless of age. For seniors who drive and own or rent a home, they should have both car and homeowner or renter’s insurance. Ideally everyone should also have some type of health insurance, either through their employer if they're still working and/or through Medicare or Medicaid.
While these are necessary types of insurance to have, seniors may still want to look at each policy to see if it can be tweaked a bit to save them money and more accurately define their needs. For example, in the case of auto insurance, they may want to cancel the collision coverage portion of the policy if the car is quite old. Seniors can also speak with their insurance agent to see how much mileage is included on their policy; for retired seniors who use their cars mainly to run errands, they may not need to pay higher premiums for annual mileage allowances they are not coming close to reaching.
Next, What Can Be Sold
In many cases, seniors purchased a life insurance policy when they were younger to help cover the immediate financial needs of their family if they were to pass away. Now that a senior’s loved ones are grown up and have homes of their own, they may not need a life insurance policy to take care of their adult children. To help free up some much-needed money, you can look into selling your life insurance policy. Through the process of a life settlement, seniors can sell all or a portion of their life insurance policy—if they wish, they can retain part of the plan to help cover funeral expenses and any final bills, or, if they determine they no longer need the life insurance policy, they can sell the entire plan for cash.
Finally, What Can Be Eliminated
Seniors who purchased a mortgage life insurance policy when they first purchased their homes may want to look into canceling it. This type of insurance promises to pay a mortgage payment in case the homeowner becomes disabled or dies. For seniors who have very little left on their mortgage and/or a decent amount in savings, this policy can safely be canceled. Also, seniors who once purchased cancer insurance may want to cancel their policy; in some cases, the cancer insurance may void regular health insurance coverage, and there have been reports that these policies have so many loopholes — it can be hard to get a payout even if the policy holder is diagnosed with cancer. Similar insurances, like heart attack or stroke insurance policies, can also probably be safely canceled by seniors.
Free Up Needed Money by Paring Back on Unnecessary Insurance
Just as seniors may wonder how they managed to collect so many coffee mugs and books over the decades, they may also be surprised to learn that they are paying out good money for a plethora of insurance policies. By taking the time to sit down and carefully assess each and every insurance plan—and then either tweaking, selling or canceling them—you can rest assured that you have only the most necessary insurance plans in place to cover your needs.