Retiring? 3 Coverage Gaps to KnowKnow the Gaps
After a lifetime of hard work, you’re finally ready to retire. It’s time to relax, pursue your passions, and do the things you’ve always dreamed about – whether that means traveling the world or buying a vacation home on the beach.
However, freedom from the alarm clock doesn’t mean freedom from all financial responsibility. As you enter the sunset years, your lifestyle undergoes enormous changes, and those may create costly gaps in your insurance coverage:
Retirement and Home Insurance Gaps
You probably purchased homeowners insurance when you first bought your home, and now your policy is collecting dust in a file cabinet somewhere. If you haven’t reviewed your insurance coverage in years (or even decades!) retirement is the perfect time to re-evaluate your coverage with your agent.
It’s especially important to pay attention to your personal property coverage, a part of homeowners insurance. Ask yourself: Have you collected expensive possessions like antiques, collectibles, art, jewelry, or furniture over the years? If the answer is yes, then ask yourself if you have the coverage you want for these valuables? It may be worth your while to increase the limits on your policy, or add additional endorsements to cover your valuables.
Typically, homeowners insurance covers belongings up to a certain limit. But those limits may not be enough to fully cover the cost of replacing them, if they’re lost or damaged. That’s a major coverage gap for your valuables!
Retirement and Liability Gaps
Once you reach retirement, you may have accumulated substantial assets. In fact, liquidating your assets may be part of your retirement planning. So, now it’s more important than ever for you to take steps to help protect those assets from negative results of lawsuits.
Typically, homeowners and auto insurance provide liability coverage, but only up to a certain limit.
Now, let’s say you loaned your vacation home to a friend for a weekend and someone slipped and fell and sued you. Or, you were driving and caused an accident that injured someone, and a lawsuit was filed against you.
The liability limits on your home or auto policy may inadequately cover the claim, leaving your personal assets at risk.
Umbrella insurance provides extra liability coverage and helps pay for damages when the liability limits of your homeowner’s or auto policies are exhausted.
Talk to a Farmers agent to discuss your potential risk exposure and help find ways to make sure everything you’ve worked so hard to build is covered the way you want.
Retirement and Life Insurance Gaps
“Not having any life insurance that is personally owned when you retire can create a gap in your coverage,” says Angela Johnson, a Farmers agent and owner of Angela Johnson Insurance Agency.
“When someone retires they can lose their life insurance, it may get reduced, the premium may increase and/or the face amount may get reduced at a certain age. And their health usually makes them uninsurable by the time they retire,” Johnson says.
That’s why it’s smart for you to plan ahead before you retire and take steps so that your spouse and your kids are financially secure after your passing. Consider working with your Farmers agent to discuss your life insurance needs and to help you make sure your policy is current.1
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1 Life insurance, annuities and accidental death insurance issued by Farmers New World Life Insurance Company, 3003 77th Ave. SE, Mercer Island, WA 98040.
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