Disability (by illness/accidents)
These 3 dreadful setbacks have probably hit most of us before.
They can strike fast and hard.
It can be so painful that all you want to do is stay in your room and cry.
The world can seem so bleak at those moments.
But you have to remember, this is life.
You know that you have your responsibilities.
Staying down forever is not an option.
You get up and recover the pieces.
One of those pieces that you will have to pick up is your insurance portfolio.
Let us take you through the 3 painful D’s and how you can re-assess your protection.
Obviously, not your own.
Coping with the loss of your loved ones often hurts the most.
It can be especially excruciating when it occurs on your spouse.
The much-cherished wonderful moments that you have shared.
The heart-wrenching pain of losing them.
And the loss of support – emotional, physical, financial and everything else.
But it will pass.
And it must pass if you have a dependent.
It’s time to get back on your feet and carry on with your life for the sake of those who you love.
After tying up all the loose ends, it is time to sit down and gather all the insurance policies that you have.
Let’s evaluate what changes you may require.
Should you become the replacement breadwinner in your family, increasing your insurance coverage is a high priority.
As your family no longer have other breadwinners, your life become much more valuable from an economic standpoint.
Naturally, your critical illness plan may need a reassessment.
You may even want to protect your income with a disability income insurance at this point.
This will prepare your family better to cope with the next ‘D’.
Should death fall upon a dependent, it is financially prudent to contemplate a lowered coverage.
As much as you are reluctant to acknowledge the unfortunate fact, the truth is that your financial obligation has diminished.
You can definitely leave it unchanged if you can afford it and assign it as additional protection for other dependents.
Otherwise, it may make sense to move part of your budget towards protecting yourself first.
Disability has many definitions.
For simplicity, we are referring to the permanent inability to work in any capacity, whether it is total or partial.
Illness and accidents happen.
It can happen to anyone, with no reason or warning.
Getting up after a hard fall define what kind of person you are.
I can’t tell you how it feel like to be disabled in any manner or how to get your life back on track.
But this guy certainly can.
And he cannot even move any part of his body but his face!
If you succeed in restoring some part of your old life, you are ready for a financial review.
You know the drill.
Assuming that you are earning less now, a reduction in insurance coverage across the board may be necessary.
Although your dependents’ needs remain unchanged, it is irresponsible to insist on maintaining the same portfolio.
After all, we have to be realistic about our budget.
In a perfect world, your insurance obligations should be reduced if you have bought a Waiver of Premium rider with your policies.
Without losing your insurance policy that is.
If you are wondering how does that work, we have a handy guide on riders.
Going on a premium holiday and subsequently letting your policy lapse is not the way to go.
If you wish to purchase insurance policies in future, you may find it difficult to obtain coverage.
Instead, converting them into paid-up policy or reducing the coverage are more sensible ways of doing things.
The one that you can avoid.
But no less hurtful than the previous two.
First thing first.
You may want to review your beneficiaries.
Unless the split is amicable, you do not want your ex-spouse to benefit from your death.
Instead, you want it to go to those whom you still love.
Get that done soonest.
Next, consider your children if you have any.
If you have already bought insurance policies for the kids and given the rights of custody, there is probably little change needed.
But should you be unprepared, you have to start looking at ways to protect your offspring better.
Obtain a critical illness coverage.
Buy a private shield plan for yourself and the young ones.
In the event that custody is awarded to your spouse, we do not recommend that you drop your coverage.
The children are still yours and thus, you have to care for them, custody or not.
If you decide to cancel your children’s policies anyway, please do the decent thing and inform your ex-spouse so that necessary arrangements can be made.
Closing in on a better part of life.
The three D sucks.
But after every trough, things can only improve.
At least that is the viewpoint of an optimist.
Take your time to grieve and get back on track.
After which, it is time to review your insurance needs.
By yourself or with your financial advisor.
Mend the broken pieces in your life.
Fix the holes in your heart.
And be sure to fill up the insurance gaps in your financial portfolio.
www.ClearlySurely.com aims to eradicate the knowledge gap between consumers and Life Insurance. Our Vision is that one day, every Man, Woman, and Child will be properly insured.