Investor Alert

Feb. 9, 2017, 6:06 a.m. EST

How to give yourself a midlife insurance audit

The coverage you still have may not be the coverage you need

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By Jack Fehr

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You might also want to look into hybrid coverage — a life insurance policy that offers benefits while you’re alive. “Some life insurance policies can supplement retirement income or pay long-term care costs,” says Copeland. Caution, though: living benefits will reduce your death benefit.

Disability insurance

If you and your loved ones depend on your income, you might need some disability income insurance. For the best deal, get it through work if you can. The average disability policy will pay about 60% of your income, up to a maximum payout of $5,000 a month. Short-term disability policies typically cover injuries for up to two years; long-term disability policies generally provide benefits up to age 65.

To keep costs down, consider extending the elimination period — how long you wait before benefits begin — to 60 or 90 days or more. You can also reduce premiums by shortening the benefit period.

Homeowners or renters insurance

Whether you own or rent your home (or multiple homes), you’ll want insurance to protect you against a potential loss, such as a fire or a theft. If you own a home, you may need additional coverage to compensate for increased replacement costs since you bought it. And if you’ve renovated your home with aging-in-place features like a walk-in shower, be sure to tell your insurer so the full value of your residence is covered, says Alderman.

Also read: 10 things your homeowners insurance might not cover

You may also want to buy flood insurance protection; your homeowner’s policy probably doesn’t include it. “Everyone is in a flood zone — it’s just a matter of how graduated their risk is,” says Aon National Flood Services CEO Keith Brown. “You can also experience water damage outside of flood plains due to breaks in dams, storm drainage backup and storm surge. Only 5% of homeowners carry flood insurance, while we estimate 20 to 25% need it.”

The Federal Emergency Management Agency reports that during the past five years, the average flood insurance claim was more than $42,000. Private flood insurance supplements the government’s maximum coverage of $350,000.

If your wealth might make you a lawsuit target, carry umbrella insurance, too. This coverage insures the excess beyond typical auto and home coverage limits of $250,000 to $350,000, as well as damages brought against you. “Umbrella coverage is probably the most important insurance you can have as you near retirement,” says Alderman. “This is a time to preserve what you have built over the years.”

Also read: Don’t forget your umbrella (insurance policy)

A few ways to cut your homeowners or renters insurance costs and reduce risk: Maintain a home security system, keep your property clutter-free and ensure that your credit is pristine. Insurers believe people with good credit are good risks and charge them less than those with bad credit.

Auto insurance

“Drivers in their 50s and 60s should benefit financially from years of safe driving and responsible management of their financial affairs,” says Barry. (Insurers can use credit-based insurance scores in 47 states.) Shop around for safe-driving and low-mileage discounts that can save you 5 to 15% off your auto liability coverage.

If you’re shopping for a car, you might want to look for safety features that are particularly helpful for older drivers. “Older individuals lose some visual acuity and reaction time skills, but technology like lane-departure warning signals and auto-braking systems can help,” says Hartwig. “Auto insurance on vehicles with these features will reflect the actual cost of fewer accidents, but these vehicles are more expensive to repair.”

And, Consumer Reports says, if your annual premiums for comprehensive (repairs for problems caused by anything other than an accident) and collision coverage are 10% or more than the book value of your car (its true worth), you might consider dropping that coverage. If you filed a claim for the car, the insurer wouldn’t pay you more than the auto’s cash value minus the deductible.

Jack Fehr is a financial writer, blogger and content creator whose specialty is making sense of financial-speak.

This article is reprinted by permission from NextAvenue.org , © 2017 Twin Cities Public Television, Inc. All rights reserved.

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