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AGS
FINANCIAL SERVICES |
Gary
F. Restall |
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Evaluating
your insurance needs
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Recently
several singular
events have
contributed to
suggesting that our
regular readers
consider 3 mistakes
that may cost them
dearly.
The first mistake is not having their insurances re-visited periodically with their insurance agent or broker. For example, some of the "older" Nursing Home or Long Term Care insurance policies may need to be reviewed to see if they are still adequate and/or fit the current need. In the last few months, several events have brought this need for review to light. One is that there has been a consolidation in the long term care insurance industry where many companies have expanded, merged, sold out, or just dropped this type of coverage for multiple reasons. Another is that nursing facilities have changed their services and daily prices. Current rates in our local area are well over $300 a day and there are facilities here in Massachusetts charging close to $400 a day. That may be 100 % to 200 % increase in the last 10 or so years in some cases, if not more. Also, many facilities are no longer just nursing homes, but may include assisted living wings and offer other needed services as well. Another is that your personal situation may have changed. For example, the beloved family member or friend you expected to be your care-giver, should the need arise, may no longer be able or available. Or, just the opposite. You now have someone that could take care of you in an emergency. Your assets may have changed positively or negatively concerning the amount of coverage now needed. One major Long Term Care Insurance Company has realized some of these changes and has started contacting their clients offering a free review of older "nursing home only" policies. Bottom line - is your older policy still valid for your situation? Look at ALL of your risks and insurance policies not just Long Term Care. May I suggest that you NEVER drop or switch any existing insurance policy without serious investigation and consideration first. Other options may be available depending on the need and situation. Sometimes, it might be wise to maintain what you have even if it has become too much coverage. Ask your agent or broker for a free review. A good rule of thumb for all of your insurances is to review your needs every 5 or so years. Especially if your personal situation has changed in any way - death within the family, new baby, divorce, separation, job change, goal changes, assets increasing or decreasing and other life-style modifications. A second major mistake that should be addressed concerns your estate plan - including wills, health care proxies, trusts, etc. Again, you should contact your attorney to review your estate plan every 5 to 7 years or when life-styles change. In many cases, no changes are needed. In many others, just simple "tweaking" is enough. While in many others, a major revision is in order. The third mistake many people are still making is not reviewing their current situation every two to five years in a comprehensive way. Have your goals and time-frames changed? New ones, any achieved or postponed? Do you still have a 6-month Cash Reserve in case of emergency and/or opportunities that may come up? Are you debt-free immediately saving interest and finance charges of 18 % to 25% after taxes? Or are you chasing the potential fluctuating 8 % to 12 % stock market investment returns and/or losses first? When have you re-visited your employee benefits’ package last? Is your net worth increasing or decreasing while planning for, in preparation for, or in retirement? These three mistakes have cost many in our local area dearly. They have cost many households, unexpectedly, hundreds of thousands of dollars in addition to needless stress and frustration while becoming a burden on others. There are many excellent sources available for sound peace of mind and knowing "I’m all set." Check your situations periodically with the appropriate sources. ___________________________________
When this
article was
written and
published, Gary F. Restall of
AGS
FINANCIAL SERVICES
was an
independent
full-service
Registered
Financial
Planner, Registered Investment Advisor
and an Insurance
Broker.
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