Group insurance for
MSBA members

Reviewing Your Insurance Portfolio-
The Key to Keeping Your Future Secure

As you reach different milestones during the course of your lifetime, the type and amount of insurance you need for financial security changes. These life events include marriage, having children, changing jobs and retiring. By planning ahead for these changes and knowing how to protect yourself, you can make a big difference in the quality of your life and your family's finances.

Marriage
Getting married and combining household expenses usually increases income as well as responsibilities. Unless single individuals have debt or are single parents, the need for life insurance is minimal. However, life insurance is something every newly married couple needs to add to their insurance portfolio to ensure there is enough money to pay mortgage and other expenses if either spouse were to die.

Depending on your needs, there are several different types of life plans available. These plans include, but are not limited to, term, whole and joint term life. Regardless of the type of plan, the key is to ensure you have enough coverage. Financial experts agree that you should have five to seven times your annual income in life insurance protection. The benefit worksheet below can help you determine how much coverage is right for you.

Children
Having children increases the demand on a family's finances, which means a substantial life insurance benefit will be needed if either parent were to die. Reviewing your life insurance benefit when you have children is critical. You need to ensure there is enough money to raise your child and provide for an education.

As your family grows, make the time to review your current benefit levels. Then contact your insurance company to adjust your coverage to meet your new needs.

Changing Jobs/Careers
When changing jobs or switching careers, it's important to review your disability insurance. Most employers offer disability programs to employees, but when you leave the job you also lose your disability benefits. This can be avoided by carrying your own disability income program.

It's important to keep in mind that Social Security is not a reliable source of disability benefits. Most people will not be considered disabled under Social Security definitions. For this reason, it's important not to count on Social Security as a "backup" plan in case you become disabled.

Even if you're not planning to switch jobs, carrying disability protection can be a good idea to supplement the benefits you receive from your employer. This is due to the tax-saving benefits offered by individual disability plans. Because you're paying the premiums for an individual plan, any benefits you receive will be tax free. In contrast, any benefits you get from an employer-provided plan will be taxable, which could substantially reduce your benefit amount. Carrying your own disability coverage can help you "fill in the gaps" your employer's plan might leave.

Retirement
Insurance is a key part of a solid retirement plan. It's necessary to ensure you're not paying more out of your own pocket than you have to. Two major types of coverage that should be considered are Medicare Supplement coverage and Long Term Care insurance.

Put simply, Medicare Supplements help pay for the costs Medicare doesn't cover. While Medicare Parts A and B cover a portion of medical costs, they don't cover everything. A Medicare Supplement will help pay for costs Medicare doesn't pick up.

Not every person needs the same Medicare Supplement benefits, though, which is why there are 10 different standardized plans available. These plans are called A-J. Each program offers a different level of benefits, depending on the amount of coverage desired. It's important to note that every company offering Medicare Supplements can only sell Plans A-J, and every Plan A, B, C, etc. will be the same from company to company. The major difference you will find between Medicare Supplements are the premiums, service, speed of claims payment and endorsement of a sponsoring organization.

Another tool people entering retirement need to consider is Long Term Care insurance. According to the American Health Care Association, Medicare pays for less than 10% of nursing home care costs.1 However, the cost of nursing home care is about $55,000 a year.2 And some nursing homes run $100,000 a year.3 For these reasons, many individuals are now turning to Long Term Care insurance to help pay for the costs of extended care.

While purchasing a Long Term Care Plan for yourself can be a smart investment, it can also be purchased for your parents or parents-in-law. This can help ease the burden of caring for an aging parent who needs extended care.

MSBA-sponsored Plans
As a service to members, MSBA can help members meet each of the needs outlined above. MSBA sponsors a full line of insurance products, including:

• Term Life Insurance
• Disability Insurance
• Long Term Care Coverage
• Medicare Supplements
• Accidental Death and Dismemberment Protection

For free information on any of these programs, call toll free 1-800-501-5776. Courteous customer service representatives will be able to help you obtain the information you need.

If you're in doubt about what your specific insurance needs are or how much coverage you should have, it's always a wise idea to visit a qualified financial adviser before locking in any benefits.

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