Retirement is an exciting new chapter, one filled with possibilities. As you prepare, it's important to make sure your insurance is ready to support you in the years ahead. When you step away from an employer's plan, some of the benefits you've relied on may not carry into retirement. To help you avoid costly surprises, here are some of the most common coverage gaps to consider before you retire.
Health Coverage
Health insurance is often the biggest change when you retire. Once your employer plan ends, Medicare becomes your primary coverage. While Medicare pays for a significant portion of hospital and doctor bills, it typically only covers about 80%, leaving the remaining costs (20%) up to you.
That’s why many retirees choose a Medicare Supplement plan to help manage those expenses. But before you reach that step, it’s important to know that timing your Medicare enrollment is critical. If you miss your initial enrollment period for Medicare Part A or Part B (and don’t have other qualifying coverage), you may face late enrollment penalties. These penalties are added to your monthly premium and are usually charged for as long as you have Medicare.
If you are still working, check whether your group plan will continue to cover you; this can affect when you need to enroll in Medicare. Keep in mind that Medicare only applies to you; your dependents will need separate coverage.
Prescription Drug Coverage
Leaving an employer plan often means losing prescription benefits as well. A Medicare Part D Prescription Drug plan can help with these expenses, especially if you take medications regularly. As with Medicare itself, delaying enrollment in Part D may result in lifelong penalties if you don’t have other comparable prescription coverage.
Plans differ in which prescriptions they cover, their monthly premiums, and out-of-pocket costs. Carefully comparing options can help you find the best fit for your needs and budget. A TMA Insurance Trust advisor can compare plans with you and walk you through your choices, with special attention to your current prescriptions.
Disability Insurance
Disability insurance is designed to protect your income if you are unable to work due to an illness or injury. Once you retire, your income typically shifts from a paycheck to your retirement savings. At that point, this type of coverage may no longer be necessary, and many physicians let it go.
Life Insurance
Your life insurance needs may also change in retirement. If you have built sufficient savings and no longer have dependents relying on your income, you may consider reducing your coverage. However, life insurance can still provide meaningful support by helping to pay off debt or leaving a legacy for loved ones.
If your employer coverage ends or if you want added protection, you have options through TMA Insurance Trust. Even physicians in their seventies may qualify for a ten-year level premium term policy with additional underwriting.
Dental, Vision, and Hearing Care
Employer plans often include these benefits, but they usually end at retirement. Maintaining coverage as you grow older, when the need for routine and specialty care tends to increase, can help reduce the risk of large out-of-pocket costs.
Closing the Gaps
Just as you would carefully review a patient’s overall health, reviewing your insurance before retirement helps you look after yourself and your family. We offer a no-cost insurance evaluation to help you assess your needs, explore your choices, and make thoughtful decisions. If your spouse is also retiring, be sure to ask about valuable household discounts that may be available.
For generations, we’ve stood beside Texas physicians, offering unbiased guidance and insurance solutions without sales pressure. We would be glad to assist you as well. Call us at 800-880-8181, Monday through Friday, from 8:00 AM to 5:00 PM CST.
