Boomers in the Sandwich Generation Face Complex Insurance Decisions

Boomers in the Sandwich Generation Face Complex Insurance Decisions

Singer Amy Grant partners with the National Association of Insurance Commissioners to encourage baby boomers to plan ahead

KANSAS CITY, Mo., June 12, 2012 /PRNewswire/ -- Today's 75 million baby boomers lead hectic lives. Many are part of what's called the "sandwich" generation, simultaneously preparing kids to leave the nest, caring for elderly parents and planning for their own retirement. These roles can present complex insurance decisions for these consumers and their families.

As a wife, mother of four, and caregiver for elderly parents, Grammy-winning singer-songwriter Amy Grant knows first-hand why understanding your options and planning ahead are key to successfully navigating the unique challenges facing her generation. That's why she is partnering with the National Association of Insurance Commissioners (NAIC) to encourage baby boomers to get smart about choices they encounter in this complicated life stage.

"Last year, my sisters and I cared for my mom while also juggling our roles as wives and mothers. Fortunately we all had the support of our husbands and kids," says Grant. "Our family was blessed not to have the financial concerns that often accompany this situation, but I know everyone isn't as lucky. Caring for my mom as she passed away really changed the way I began to think about my own future and that of my children. I think it's important for others to prepare for the inevitable twists and turns heading our way on life's journey. The NAIC is a great resource to get the facts and plan ahead so you can focus on what matters when life's challenges come your way."

Many of the everyday financial choices boomers face come with complex health and life insurance implications. The NAIC can help boomers decide what coverage they need for their stage of life whether it is caring for an ailing parent, thinking about health insurance for a college-age child or planning for retirement.

College-Bound Kids

Research suggests 50 percent of boomers are caring for youngsters at home while providing primary financial support to one or more children over 18. Many of today's boomers find themselves simultaneously researching college campuses for their children and nursing homes for their parents, and trying to figure out how to cover both costs. There are a few insurance options that may be helpful:


-- Confirm your child can remain covered by a current health insurance
policy until age 26; college-bound students may have additional
individual health coverage options through the school or a nearby
insurer.
-- If a child has completed college or is no longer financially dependent,
review your life insurance policy to determine if you can decrease your
life insurance coverage.
-- As your child plans to leave home, it is a great time to think about
your needs. If you're not sure you have the resources to cover your own
care in the event of a chronic health condition or disability, long-term
care insurance may be a way to reduce the potential financial burden:
-- Almost 70 percent of people 65 or older will need long-term care
services at some point in their lives, and it can be expensive. Care
in a nursing home can cost around $80,000 or more annually, and, of
those who enter a nursing home, more than half will stay longer than
a year. Many incorrectly believe regular health insurance or
Medicare will pay for these services, but on average, Medicare only
covers about 2 percent, while private health insurance covers about
1 percent of nursing home costs.
-- Depending upon the level of your income and assets, you may be
eligible for your state's Medicaid program, which will cover some
long-term care expenses.
-- Your age, health status, retirement goals, income and financial
assets all are key considerations in determining whether the
purchase of private long-term care insurance is a smart choice.
Since premiums and health issues increase with age, advisors
recommend purchasing a policy before you turn 60. However, since 79
is the average age people enter a nursing home, make sure you can
afford the premiums for an extended period of time.
-- Research the company and agent selling the policy, as both must be
licensed in your state. Also find out if your state participates in
the Long-Term Care Partnership Program, which allows private long
term care insurance coverage while maintaining Medicaid eligibility.
Check with your state insurance department for details on what is
available where you live.
-- Check out NAIC's free long-term care buyer's guide and online quiz
for more help with this decision.
Caring for Aging Parents

Thanks to advances in healthcare, 71 percent of today's baby boomers have at least one living parent. In addition, slightly more than one out of every eight baby boomers are simultaneously raising a child and providing some form of financial assistance to their parents, and nearly 10 million boomers over 50 are caring for an aging parent. Being well-informed about health and life insurance choices for your parents may help ease your financial burden.


-- Make sure your parent enrolls in Medicare before they turn 65, and
review their total coverage to determine if there are any gaps. Medicare
Supplement Insurance -- also known as Medigap plans -- are available for
additional coverage. There are 10 standardized plans ranging from
letters A to N; additional coverage and costs increase as you move up
the alphabet. NAIC has a free Medigap plan guide to help you learn more.
-- If your parent needs nursing home care, determine if his/her monthly
income meets your state's eligibility level for Medicaid. If your parent
does not qualify for Medicaid, find out if he/she has a long-term care
insurance policy or a life policy with a rider or accelerated benefits
provision that might help cover nursing home care.
-- Check to see if your parent has a life insurance policy and familiarize
yourself with the provisions. If so, store it in a safe place. Know the
location of the policy, who is listed as beneficiary, how claims are
triggered and payout instructions. If your parent doesn't have a policy,
a Guaranteed Issue Whole Life Insurance policy may be an inexpensive
option to cover end-of-life expenses.
Planning for Retirement

Approximately 2.5 million boomers turned 65 last year making them eligible for retirement. And more than 72 million pre-boomers are approaching the same milestone. Securing affordable health insurance is one of the greatest obstacles to retiring before age 65. There are many choices to consider:


-- If you are covered by an employer-sponsored group health insurance
policy and planning to retire soon, inquire whether your employer
sponsors a retiree group plan, or if you can convert the coverage to an
individual policy. Also, compare that coverage with available coverage
through your spouse's employer.
-- If you are in good health and can afford high out-of-pocket expenses
(minimum of $1,200 for an individual or $2,400 for a family), you may
consider a high-deductible plan. This coverage requires you to pay out
of pocket for basic doctor's visits and prescriptions through a
tax-advantaged Health Savings Account, but still provides coverage for
major medical care such as surgery or disease treatment.
-- If you have a pre-existing condition, you may qualify for Pre-existing
Condition Insurance Plans (PCIP) if you have been uninsured for at least
six months. These policies cover a range of benefits including primary
and specialty care, hospital care and prescription drugs. They also do
not require a higher premium because of your pre-existing condition and
do not base eligibility on income.
-- Depending on your age and future income, purchasing an annuity may make
sense as you plan for retirement, as annuities typically pay an income
that is guaranteed to last as long you live. Be sure to consider the
investment amount and risk tolerance before an annuity purchase. Learn
more from NAIC's free guide on fixed deferred annuities.
-- Annuities are not generally recommended to reach short-term
financial goals. Understand the surrender period of the policy and
the fees involved to determine if it makes sense for your life
stage.
-- Find out if the annuity allows you to tap into the principal before
maturity and if penalties apply for early access. Before you buy,
consider all purchase fees and tax implications, and make sure you
understand the policy's surrender period. The surrender is how long
you must wait before taking money out of an annuity without penalty.
"Whether you are planning for retirement, caring for elderly parents, preparing to send a child to college or maybe all three, the NAIC is here to help you get smart about insurance so you can confidently choose what suits your needs," said Kevin M. McCarty, NAIC President and Florida Insurance Commissioner.

Visit www.insureuonline.org to find out how to contact your state insurance commissioner, an unbiased resource for insurance information specific to where you live. For additional information and tips for navigating the many insurance decisions facing boomers, visit boomers.InsureUOnline.org.

ABOUT NAIC

The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization created and governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. territories. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight. NAIC staff supports these efforts and represents the collective views of state regulators domestically and internationally. NAIC members, together with the central resources of the NAIC, form the national system of state-based insurance regulation in the U.S. For more information, visit www.naic.org.

ABOUT AMY GRANT

Amy Grant's career spans over 30 years and stretches from her roots in gospel into an iconic pop star, songwriter, television personality and philanthropist. Grant has sold more than 30 million albums and won six GRAMMY® Awards in multiple categories, beginning with the platinum selling Age to Age in 1982. She also has six No.1 hits, including "Baby, Baby," and "Every Heartbeat," and is one of only two Christian artists to be awarded a star on the legendary Walk of Fame in Hollywood. Grant released her first live recording in 25 years with Time Again ... Amy Grant Live in September 2006, and then announced her first ever label shift to EMI Music Group where her entire music catalog was re-mastered and released via a GREATEST HITS CD. In March 2010, Amy released "Somewhere Down The Road," a collection of songs about the journey of life and faith. The album debuted at No. 2 on the iTunes Christian music chart and the first single "Better Than A Hallelujah" was a Top 10 Christian radio hit and No. 1 on the iTunes Christian singles chart. Grant is currently in the studio working on a new record due in 2013. She is married to country star Vince Gill and mother to their blended family of five kids. For more information, go to www.amygrant.com.





SOURCE National Association of Insurance Commissioners (NAIC)

National Association of Insurance Commissioners (NAIC)

CONTACT: Holly Bachand, +1-816-512-2427, holly.bachand@fleishman.com, or Scott Holeman, +1-816-783-8909, news@naic.org

Web Site: http://www.amygrant.com


-------
Profile: intent