The Boomers Insurance Guide for Ages 60-78

According to the U.S. Census Bureau, there are 76.4 million baby boomers in the U.S — 21% of the U.S. population. If you were born between 1946 and 1964, you are part of the boomer or baby boomer generation and there are several insurance considerations to make within the age range of 60 to 69 years old.

Overall, insurance rates across the board have gone up because nearly everything is more expensive these days, including medical services, car parts, construction materials and labor. As a result, you should review all of your insurance products annually, cut coverage you no longer need, switch to a more economical plan or add necessary coverage that may save you money in the long-run.

Take a look at some statistics about boomers. This may help you decide which insurance products you need.

• Roughly 10,000 boomers sign up for Medicare each day.^[1]
• 90% of boomers have either private health insurance, insurance through an employer or Medicare.^[2]
• 54.2% of boomers own a home, according to the U.S. Census Bureau.
• Roughly 45% of Boomers are renters.
• 62% of new car buyers are boomers.^[3]
• Baby boomers own 2.3 million businesses in the country and employ about 25 million people.^[4]
• 58% of boomers own a life insurance policy.^[5]
• About 61% of boomers are married.^[6]

Key Takeaways Boomers should consider a Medicare Advantage plan over Original Medicare due to the unique advantages they offer. Boomers who choose to stay with Original Medicare should consider buying Medicare supplements to cover out-of-pocket expenses. More than half of boomers own a home and need homeowners insurance and those who rent instead will need renters insurance. The majority of boomers own a new car, which means they need full coverage car insurance. More than half of all boomers own a life insurance policy and it may make sense to buy one if you’re without.

Health Insurance

Most Boomers are on Medicare and if you’re one of them, you can skip to the next section on Medicare. If you’re under the age of 65 and are not yet eligible for Medicare, you may have a private health insurance plan or one through an employer. If you have a private plan, it’s a good idea to compare health insurance plans each year to make sure you’re getting the best plan for the least amount of money.

If you don’t have health insurance, you’re at risk of filing for medical bankruptcy, which may result if you get injured in a car accident or suddenly get sick and can’t afford the medical bills. You may also neglect your annual screenings, which may lead to a more serious condition; Early detection is vital to staying healthy.

Subsidized Health Insurance Plans

A subsidized marketplace plan can be affordable but if you don’t qualify for these plans, there are other options that may fit your budget. It’s not recommended that people in this age group buy a high-deductible bronze plan with a health savings account (HSA) but if it is the absolute most you can spend, this option is the most affordable way to go. However, you’ll at least have a deductible so if you end up needing an expensive treatment or surgery, there will be a limit on out-of-pocket expenses.

It is advised that boomers choose a traditional health plan, preferably silver or higher. A more comprehensive plan may cost more each month, but it will likely save you money over the course of a year. HMOs usually end up costing less over the course of a year than PPO plans and these are the most common types of plans available.

Spouse’s Health Insurance

More than 61% of boomers are married and that means you can share a health insurance policy with a spouse, if they are not yet on Medicare. Some people, however, prefer to have separate policies, despite it generally costing less to be on a family plan.

Medicare and Medicare Advantage or Medicare Supplements

Many boomers who are eligible for Medicare have it as their health insurance plan. You are eligible for Medicare at age 65 or older. In fact, you can sign up three months before your 65th birthday. Medicare is a government-run program for seniors who are legal residents and citizens and have paid social security taxes during their lifetime. Residents who have been living continuously in the U.S. for five or more years also are eligible.

What many people don’t know is that when they sign up for Medicare, they have the option of choosing Medicare Advantage instead. Medicare Advantage is the private version of Medicare and also offers vision, dental and hearing benefits and certain prescription drug plans that Original Medicare does not.

That said, if you choose to stay with Original Medicare, there are Medicare supplements that you can buy to help you with out-of-pocket expenses. Part D, for instance, will help cover the cost of prescription medications.

Some Medicare Advantage plans have zero dollar premiums, but it’s important to consider coverages, not just the monthly pricing. Use your previous year’s medical history to determine how much care you need when buying a plan.

You can switch into or out of original Medicare each year October 15 through December 7, during the Medicare open enrollment period.

Car Insurance

More than half of boomers are driving new or newer cars, which means that these cars are likely being financed or leased. Lenders require full coverage car insurance on these cars, which includes state minimum requirements in addition to comprehensive and collision coverages.

Gap coverage is recommended for those who have an upside down loan, or a loan that is greater than the car’s Kelley Blue Book value. With this coverage, if you have a total loss with the car you won’t be left with a remaining balance.

Keep in mind that if you live in a household where cars are shared, each person in that household will be considered when you are being rated by the insurance company. In many states, each person’s credit score can have an impact on your car insurance rate.

Exclude High-Risk Household Members

When you exclude a high-risk person from your policy, your car insurance rate will be lower but if that person drives that car and has an accident, the accident won’t be covered at all. Only choose this option if the people you plan to exclude never borrow your car.

Non-Owners Car Insurance Prevents Lapses

A lapse in coverage will raise your rates so if you’re in between cars, buy a non-owner car insurance policy during the interim. That way, when you do buy car insurance, you won’t risk even a single-day coverage lapse increasing your rate.

Liability Coverage’s Limitations and Full Coverage

If your car is new, you’ll need liability coverage and all other state required coverages as well as collision and comprehensive coverage if the car is being financed or leased.

If your car is worth less than $4,000 and it’s paid off, consider dropping comprehensive and collision. Otherwise, you could be paying more in premiums and a deductible than a claim would pay out for a total loss.

You May Be Uninsured Without a Business Auto Policy

If your car is a business-related vehicle, you’ll need a commercial auto policy. Real estate agents, caterers, food trucks, cleaning services, landscapers and anyone who makes work-related trips will not be covered with a personal auto insurance policy. It’s a good idea to tell your agent what you need your car for on a regular basis, even if it’s a few times a week. The majority of businesses in the U.S. are owned by boomers, so make sure you have the right type of vehicle insurance.

Home Insurance

More than half of baby boomers own their own homes and homeowners insurance is required with a mortgage. Sometimes, it gets lumped into escrow and if you want to save money, you should shop around and compare quotes.

If you’ve paid off your mortgage, it’s still a good idea to have a homeowners insurance policy.

Severe storms are more common in certain areas and a leak or fire could destroy your house and all your personal possessions. With a homeowners insurance policy, you’ll get help rebuilding your home and replacing your belongings.

Switching Home Insurance Policies

Switching homeowners insurance is easy but make sure you’re comparing the same type of homeowners policies. Also, make sure to buy the new policy before canceling the other. Otherwise, your lender will be notified and may take out a policy on your behalf. Don’t allow a single day between the change in coverage because a lapse in coverage can raise your insurance rate at renewal.

Renting Out a Room

If you rent out a room, it’s best to require the tenant to buy their own renters insurance policy because you’re only insured for your belongings, not theirs. You may even be required to carry a landlord policy but this will not cover your renters, only yourself and your household. If relatives live with you, just make sure your contents coverage of the home insurance policy is set at a high enough limit to cover everyone’s losses if everything is destroyed.

Renting Out a Home

A commercial landlord policy is needed when you rent out your home and you should require the renters to have renters insurance. Explain that if something happens to their belongings, your landlord policy won’t cover it.

If you are renting out the home through Airbnb, you may still need some home insurance coverage. Find out what you need to insure by speaking with an agent, not after you find the need to file a home insurance claim.

Renters Insurance

Boomers who are renters must buy a renters insurance policy, even when the landlord does not require it. If a fire or storm damages your belongings, a landlord’s insurance policy will not cover your personal possessions.

You’d need renters insurance to help make you whole if a leak destroys your electronics, furniture or clothing. The good news is that renters insurance can be relatively inexpensive. Just make sure to have the right coverage limits to protect everything you own.

Inventories for Renters

Before buying a policy, consider how much coverage is needed, especially if there is more than one person occupying the home. Creating an inventory is the best way to figure out how much coverage you need and it makes filing a claim much easier. After adding up how much your items would cost to replace, select your coverage limit.

Commercial Insurance

Most American businesses are owned by boomers and most of the workforce works for them. If you have at least one employee, you’ll be legally required to carry workers’ compensation in most states and perhaps commercial auto insurance if you use your car for business-related activities or have a business fleet. Most businesses also carry coverage to protect against lawsuits and interruptions due to severe storms as well as coverage for cyber and other types of crime.

General liability insurance is the bare minimum coverage business owners buy to protect against third-party injuries and lawsuits. A business owners policy bundles the most essential coverages, including commercial property, for a better value.

Life Insurance

Term life insurance or permanent life insurance is more expensive to buy in your sixties and much more in your seventies.

However, it may still make sense to buy life insurance despite the costly premiums, especially if you have dependents and an existing mortgage that your survivors would have trouble paying.

Term Life Insurance

When buying a term-life policy, you may not be required to undergo a health exam, which can be beneficial when you’re older and may have certain conditions. When setting your death beneficiaries, you may want to list your spouse, children or grandchildren.

Permanent Life Insurance

A permanent life insurance policy creates a cash value but will usually require a physical exam, which will determine your rate. The benefit of a cash value policy is that you can withdraw or borrow against it but it’s generally more difficult when you buy it when you’re older since the cash value needs time to grow. Alternatively, if you’re looking to just cover your funeral fees, you can look into burial insurance.