By Bertus Visser
THEY say that the one constant in life is change, and this is certainly true for anyone entering their senior years.
Suddenly you may find yourself working less, enjoying your hard-earned money more and spending your time on more relaxing pursuits.
However, lifestyle is not the only thing that evolves as you enter into your next life stage. As your health and financial needs start to change, so do your risks and insurance requirements.
People in their senior years should start to look at their risk management processes a little differently.
Around age 65 or 70 is when you should start taking stock of changes in your vehicle usage, the possible shrinking of your asset base, your medical needs, and life insurance requirements – alongside a range of other factors.
In recognition of National Older Persons Week from September 27 to October 3, it would be wise to have a long conversation with your adviser about structuring an insurance portfolio to match your current needs that suit your pocket, allowing you to make the most of your finances.
It’s important for older people to revisit their insurance portfolio and adjust their cover as they downscale their lives, since this will affect their risk profile. For instance, if they are moving to a retirement village or old age home, this will affect their risk profile and they should pay a smaller premium. Similarly, you might scale down on the possessions you take with you to a smaller property, and this in turn can have an impact on the amount of cover that you need.
The same applies to their vehicle insurance: as they drive less, their risk declines and they may want to increase their excess to pay a smaller monthly premium. In fact, some insurers waive the excess entirely for people over the age of 55. Many insurers now also provide the option to pay only for the mileage you drive, which is a good option for older people who generally tend to drive less.
On the one hand, people over the age of 55 can actually get much lower premium rates for car insurance than younger people as they are considered less “risky”. On the other hand, these lower premiums may come with a few additional stipulations to comply with which may change as you age to help you manage your risks better.
Value added services can be a great addition to your portfolio. Add-ons such as 24-hour emergency assistance, road cover including licence renewal services (which can be very beneficial to older people), free assessments, tyre and excess solutions can come in handy and make life a little easier while helping to save a little money too.”
Entering into your next life stage has its benefits and presents a great opportunity to better manage your risks while scaling down your spend on insurance products.
It may become a bit more complex to compile a great insurance portfolio, but a good adviser can make it happen.
Bertus Visser is Chief Executive of Distribution at PSG Insure.
PERSONAL FINANCE