More and more, people plan to work past age 65. Pew Research Center says that 29% of Boomers between the ages of 65 and 72 were working or looking for work in 2018, a rate that is noticeably higher than that of previous generations, while a survey from the Employee Benefit Research Institute found that 45% of workers aged 55 or older plan to work past age 65.
Unfortunately, things don’t always work out as planned. According to data from ProPublica and the Urban Institute, more than half of older workers in the U.S. are forced out of longtime jobs before they feel ready to retire, and this can be an irrecoverable blow to their finances.
Disability is one factor that can force people out of the workforce, and seniors are especially susceptible. Buying disability insurance after age 65 may not be possible.
However, some policies that were purchased earlier will continue to pay out benefits past age 65, sometimes until age 70.
Be sure to talk to your clients about how long they intend to stay in the workforce, and the need to purchase IDI while it’s still an option for them. Also, talk to clients about the following three options:
1. Retirement Security Rider for Individual Disability Insurance
Think about this nightmare scenario: A doctor suffers a career-ending disability soon after leaving medical school. If she has individual disability insurance, her income could be protected by an IDI plan and she could potentially receive benefits until retirement age.
So then what happens? When this person reaches retirement age, her benefits will stop. Since she hasn’t worked since becoming disabled, there probably isn’t much saved for retirement. In this case, a DI Retirement Security Rider could help.
By combining IDI with Retirement Security, the insured is covered up to and through retirement.
If the insured becomes disabled during her working years, the Retirement Security Rider pays into an Irrevocable Trust. These funds are invested on the insured’s behalf and are not available until the end of the disability insurance benefit period.
2. Long-Term Care Insurance:
An alarming statistic shows that while 70% of the population will need long-term care, only 14% of people have insurance that will cover the cost. Expenses like nursing homes, home health care, or modifications to your residence to accommodate physical limitations all become more likely as we age. LTCi, paired with a strong IDI contract, will help ensure that your client’s lifestyle is protected for their entire life.
3. Critical Illness Insurance:
CI pays a lump-sum benefit upon diagnosis of one of the covered illnesses. This includes, but is not limited to cancer, heart attack/stroke, and motor neuron diseases. Not only is the Critical Illness Insurance contract payable for life, but some types of heart attack/cancer coverage are also available to underwrite on clients up to age 89. This benefit can be used to help offset any potential rise in expenses should a devastating health concern arise.
Contact our sales department for more tips on how you can combine products to make sure your clients are fully covered!