Are You Covered By These Four Key Insurance Policies?
Brett Gottlieb
Helping You Navigate the Transitions in Life | Income Plan | Investment Plan | Tax Plan | Healthcare Plan | Legacy Plan | Retirement Plan
When you think of insurance, the word protection probably comes to mind. If you get into a car accident, your auto insurance will protect you from being held responsible for the entirety of expenses incurred. Having health insurance can protect you from crippling debt caused by the outrageous cost of healthcare. You get the picture.
Nevertheless, insurance costs money. And when you have more pressing and tangible financial priorities, such as building up your 401(k) or establishing your child’s college fund, it’s tempting to just hold off on optional insurance products for the time being. But the fact of the matter is, a great savings rate means nothing if your financial plan doesn't include appropriate protection against risks. Risk management via insurance is a vital part of a comprehensive financial plan. Without adequate insurance coverage, your plan is not solid and your financial future is not secure.
Having the appropriate insurance in place gives you a guarantee that your assets are protected and your family can rely on a secure financial future even when the unexpected happens. The peace and safety that insurance provides is worth every penny. Below are the four key types of insurance that are essential pieces of your financial plan:
1. Life Insurance
Life insurance, the only insurance that is guaranteed to be claimed by every person sooner or later, comes in as the most commonly purchased form of insurance in conjunction with a financial plan. It not only covers all of your final expenses and the ever-increasing financial requirements of your funeral, but also protects your dependents from financial crisis when you pass. It is so much more than just money for a burial. This makes it especially imperative that you carry a comprehensive life insurance plan if you have children or others who depend on you financially. And as time goes on, certain variables will change. For example, paying off an automobile or mortgage, welcoming a new baby into the family, or a child graduating from college. Therefore, it is also wise to make a habit of reviewing your coverage at least once per year and making adjustments where needed.
As of 2018, only 59% of Americans carry some sort of life insurance, whether it be a group policy through their employer or an individual policy. (1) Even worse, 1 in 3 families admit a financial disaster, within a single month, would more than likely, if not positively, happen should the household’s breadwinner suddenly pass. (2) Life insurance policies should be built to take into consideration mortgages, non-mortgage debt, childcare, college savings, and more. Stay-at-home parents should also have coverage since they provide indispensable services that would be considerably expensive to outsource in the event of their death. Furthermore, business owners may have additional insurance needs in order to protect the future of their business or a business partner.
More recently, life insurance has evolved to provide “Living Benefits,†a way for you to use the proceeds from your insurance while you are alive, not just for a family member to use after you are gone. Three key types of living benefits are available if:
- You’re terminally ill. You can receive a portion of your death benefit in advance for help with medical expenses, or even one final around-the-world adventure.
- You’re chronically ill. Often you’re considered chronically ill if you can’t perform several of the six activities of daily living, such as getting out of bed, feeding yourself, bathing, and so forth. You can receive a portion of your death benefit in advance in situations like this.
- You’re critically ill. This could mean you’ve been diagnosed with a heart attack, stroke, cancer, end-stage renal failure, major organ transplant, or some other grim illness. Again, you can get some or all of your death benefit early—in time to be of some use to you.
If you are currently looking for life insurance, make sure to look into these valuable options. Or if you have an older policy, consider the benefit of upgrading what you have to include some of these additional benefits.
2. Long-Term Care Insurance
If you are approaching age 65, it may be a gamble to go without long-term care insurance. According to the U.S. Department of Health and Human Services, an average of 63% of people turning age 65 will require some form of long-term care during their lifetimes. (3) Additionally, 20% of 65-year-olds will need long-term care for more than five years. (4)
Long-term care insurance is designed to cover the long-term support and services you will need as you age, including personal and custodial care in a variety of settings, such as your home, a community organization, or other facility. (5) Fortunately, today’s long-term care policies offer more flexibility and benefits than ever before. It is important to understand the long-term care insurance options available to you, and whether or not a policy is appropriate for your lifestyle and situation. And the sooner, the better, as premium rates typically rise with age. While some policies can be expensive, requiring long-term care without insurance in place to cover the daily costs can be financially devastating.
3. Long-Term Disability Insurance
The Social Security Administration estimates that the average 20-year-old worker has a 3 in 10 chance of being disabled before age 65, (6) but only one-third of Americans have disability insurance. (7) An accident, injury, or illness that keeps you from working can wreak havoc on both your current financial requirements as well as financial plans for the future, setting you back months or even years.
While many people believe they are covered by their employer’s long-term disability insurance, most fail to understand what is provided to them, and often the coverage is limited and inadequate. Private long-term disability coverage will pick up where an employer’s long-term benefits fall short. If you have a high-paying job or are the primary provider for your family, it’s especially crucial to purchase long-term disability insurance in order to protect against a sudden and unexpected loss of income.
4. Umbrella Liability Insurance
Have you ever stopped to consider what would happen if you got into a major car accident and you were at fault? Or what would happen if you experienced a disaster in your home? Many times your homeowner and auto policies have limits, and significant catastrophic events can easily exceed these limits. Additionally, many of these auto and homeowner insurance policies have exclusions that list a number of circumstances that are not protected.
Umbrella insurance is extra liability insurance designed to help protect you from major claims and lawsuits. As a result, it helps protect your assets and your future. It kicks in when your other policies have been exhausted, and provides coverage for claims that may be excluded by your other policies. (8) Umbrella insurance can provide coverage for things such as injuries, false arrests, lawsuits, property damage, and more. Umbrella insurance fills in the gaps and completes your protection, allowing you to have total peace of mind.
Get The Insurance You Need
Have you reviewed your insurance coverage within the last 12 months? If not, you may benefit from a comprehensive review. A review not only updates any areas of need in order to ensure your family and financial future are secure, but also gives you the opportunity to brush up your knowledge and understanding of what you have in place. By going in for a review, you can receive professional assistance in claiming the money that is rightfully yours. And since insurance can quickly become complicated, an experienced agent can offer you simple and accurate guidance on the products available to you and how they can integrate into your other financial strategies. If you would like to review your policies or discuss how insurance can lower your risk and protect your assets, email us at info@ComprehensiveAdvisor.com or call (760) 813-2125 today! You never know when a need will arise. Don’t risk everything by waiting until it’s too late.
About Brett and John
Brett Gottlieb is the founder of Comprehensive Advisor and a financial advisor with nearly two decades of industry experience. He graduated from California State University-Chico with two bachelor’s degrees in Business Administration and Economics. Brett is Life, Accident and Health Insurance licensed in several states.
John Mc Kean, financial advisor, joined Comprehensive Advisor in 2016. He has been in the financial services and retirement planning industry for over six years. John is Life, Accident and Health Insurance licensed in California.
Brett and John previously worked as a Registered Representatives with Securities America, one of the largest independent broker/dealers in the country, and currently offer advisory services through Legacy Road, LLC, a Registered Investment Advisor. Both are passionate about educating clients on retirement planning. They take a common-sense approach to the planning process and work with clients to create a retirement road map to help ensure their assets are protected and they receive the income needed to enjoy their future. Based in Carlsbad, California, they work with clients throughout San Diego County. Learn more by connecting with Brett on LinkedIn or email us at info@ComprehensiveAdvisor.com.
Advisory services offered through Legacy Road, LLC, a Registered Investment Advisor.
Brett Gottlieb, Investment Advisor Representative. California Insurance License #0C68886.
Comprehensive Advisor and Legacy Road, LLC are not affiliated.
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(1) https://www.bestliferates.org/blog/2018-life-insurance-statistics-and-facts/
(2) 2016 Insurance Barometer Study. https://www.lifehappens.org/industry-resources/producer/barometer2016/
(3) https://longtermcare.acl.gov/the-basics/
(5) https://longtermcare.acl.gov/costs-how-to-pay/what-is-long-term-care-insurance/
(8) https://www.geico.com/information/aboutinsurance/umbrella/
Regional Sales Director @ Midland National? & Wealth Management Director @ Precision Wealth
6 å¹´Informative Article, Brett. You are clearly a "Comprehensive Advisor".