October 16, 2009

Do I Still Need Insurance Coverage After Retirement?

By the time we reach our retirement age, most of or children would have graduated from school or at least reaching tertiary level. Then some of us might wonder, do we still need insurance coverage? Speaking from personal experience, my dad terminated all his insurance coverage a few years after his retirement. I dont have the chance to ask him on why he terminated all his coverage, but i would assume that by then he doesn't see the need for having insurance coverage anymore.

So, the question is: do i still need insurance after my retirement? First of all, review what coverage you have in your insurance policy. Then, decide on which part of insurance that you still think that is critical for you post retirement.

Now, let's look at some of the major components of a life insurance policy:
  • Life/Permanent Disability  - Since the objective of insurance is to provide for your family should untoward incidents happen to you prematurely, you COULD terminate the life policy if your dependencies are all financially dependant and you have some spare cash to handle emergencies.
  • Critical Illness - If you have a stand alone plan, you should maintain this plan. If this plan is attached to a life/TPD policy, then you SHOULD NOT terminate you life policy.
  • Hospitalization & Surgery - If you have a stand alone medical card, PLEASE maintain the medical card. If you have it attached to a life insurance, DO NOT terminate the life policy.
  • Personal Accident - You may consider buying a stand alone PA plan since the plan is relatively inexpensive.
Another aspect to consider when you are nearing your retirement is that you should review the sum assured of your life policy. Why? Let's discuss about this in the next article.


Peter Lim said...

I beg to differ. I don't see any point to insure if say, your net worth is like $ 10 million or so.

Insurance is like lottery ticket. It's good to have it, but if you have to pay for it... then you have to weigh the price vs what you get, especially when you don't have the need.

jutamind said...

True, i agree with you that if you are rich enough to cater for any adversities, you probably dont need any insurance.

My article is targeted to most of us, the layman.

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