For South Africans over 65, securing and building an insurance portfolio is essential to protecting your health, finances, and loved ones. Retirees must make informed decisions about the types of cover that best suit their later life. These include health insurance, life insurance, funeral cover, and critical illness cover.
It is advisable to start building your insurance portfolio before you turn 65, as there are typically hefty price differences in premiums. However, as the saying goes, “better late than never”.
Let’s have a better look at these must-have insurance options for over 65s, retirees, and pensioners.
Why Insurance Matters After 65
As you transition into retirement age, your priorities inevitably shift. Medical expenses may increase, and financial security for your family becomes even more important.
With the right insurance products under their belt, retirees and seniors can:
- Cover unexpected medical expenses and funeral expenses
- Provide for loved ones in the event of illness, severe illness, or death
- Receive support during a medical crisis or critical illness
- Ensure retirement funds and savings are protected
Essential Insurance Types for Retirees
1. Medical Aid & Supplementary Health Insurance
Medical costs tend to rise with age, especially when access to quality healthcare becomes vital. Being on a medical aid that supports regular check-ups, scopes, and tests ensures you can be on top of any diagnosis.
Supplementary health insurance, like gap cover for retirees, can help cover the shortfall that occurs during in-hospital procedures, specialist visits, and ongoing medical expenses.
2. Life Insurance Policy & Life Cover
Life insurance provides financial security for your loved ones in the event of your passing. Policies for seniors may include whole life or term life cover.
Whole Life Insurance: This type of policy provides lifelong coverage, paying out a lump sum to your beneficiaries whenever you pass away, as long as premiums are kept up to date. Some whole life insurance policies can also build cash value over time, which you may borrow against if needed.
Term Life Insurance: Term life insurance covers you for a specified period, such as 10, 15, or 20 years. It is often more affordable than whole life insurance and provides a death benefit if you pass away during the term. This type of policy is ideal if you want to cover specific financial obligations, like outstanding debts or supporting dependents like elderly parents, during a certain timeframe.
When choosing a life insurance policy, consider your family’s needs, outstanding debts, retirement funds, and the cost of funeral expenses. Also, be aware that some policies may require a medical examination or assessment of your medical history to determine eligibility and premiums.
It’s advisable to sign up for life insurance before you turn 65, as many providers have maximum age limits for new policies. Nevertheless, there are a few options available for those over 65, including specialised plans tailored to seniors’ insurance needs.
Just ensure you have all your ducks in a row when it comes to medical history and documentation, should you need it!
3. Funeral Cover
Funeral cover ensures that your family is not burdened with the costs of a funeral.
These policies pay out quickly and are designed to cover funeral expenses, making them a practical choice for retirees who would like to help their family in the event of their passing.
4. Critical Illness Cover & Disability Cover
Critical illness cover pays a lump sum if you are diagnosed with a serious illness such as cancer, heart disease, or stroke. This can help manage medical expenses, support recovery, and protect your retirement savings from unexpected costs.
Disability cover and severe illness cover are also important for seniors who could encounter a medical crisis or terminal illness in their later years.
5. Travel Insurance
Consider additional options such as travel insurance to further protect your retirement savings and provide coverage for medical expenses during travel or unforeseen events.
Travel insurance can offer coverage for medical emergencies, trip cancellations, lost luggage, and other travel-related risks. As medical expenses can be significantly higher when travelling abroad, having dedicated travel insurance ensures you are protected against unexpected costs. Many policies also accommodate pre-existing medical conditions, making it easier for seniors to travel with peace of mind.
Limitations of Insurance for Retirees in South Africa
While insurance in South Africa offers valuable protection, it’s important to be aware of certain limitations and challenges when signing up after 65:
- Age Restrictions: Many insurers set maximum age limits for new policies, which can make it difficult for seniors to access certain types of cover after a specific age.
- Pre-Existing Medical Conditions: Coverage for pre-existing medical conditions may be limited, subject to waiting periods, or excluded entirely. Always review policy terms carefully.
- Premium Increases: Insurance premiums often rise with age, medical history, or changes in health status, which can impact affordability for retirees on fixed incomes.
- Benefit Caps and Exclusions: Some policies have caps on benefits or exclude specific conditions, such as terminal illness or severe illness, which may leave gaps in coverage.
- Limited Product Choice: Not all insurers offer comprehensive products for seniors, and options like disability cover, travel insurance, or critical illness cover may be restricted.
- Complicated Claims Processes: Navigating claims can be challenging, especially for retirees unfamiliar with digital processes or complex documentation requirements.
Understanding these limitations helps retirees make informed decisions and seek advice from an intermediary to ensure they get the right cover for their needs.
Gap Cover Insurance: A Must-Have In Your Retirement
Selecting insurance after 65 is a personal decision that should be shaped by your health, financial situation, and family circumstances.
When it comes to managing medical costs in retirement specifically, TRA’s Gap Cover is an essential option to consider.
- Gap Cover can help bridge the gap between your medical aid payouts and actual healthcare costs, protecting your retirement funds from unexpected medical expenses.
- TRA Gap Cover offers policies for retirees.
- Beyond medical shortfalls, TRA Gap Cover includes access to TRA Assist, a 24/7 support service offering emergency help and efficient claims processing.
- TRA’s policies also include travel insurance for people under 71, ensuring your medical costs overseas are covered.
- TRA is known for its fast and reliable claims handling, making it easier for retirees to receive the support they need without unnecessary delays or complications.
Consult with your financial adviser and see how TRA Gap Cover would complement your existing insurance portfolio. Retirees and pensioners may specifically want to consider the following comprehensive gap cover plans Super Cover Plus and Absolute Cover Plus.
Frequently Asked Questions for Insurance for over 65s
What is the best insurance for retirees in South Africa?
The best insurance options for retirees may include health insurance, life insurance, funeral cover, and critical illness cover. Look for providers with strong reputations and flexible options. Subject to the unique circumstances.
Can I get health insurance for over-65s?
Yes, many insurers offer health insurance for seniors, including cover for pre-existing medical conditions and medical history. Be sure to check for coverage limits, waiting periods, and maximum age for any limitations.
If you join a medical aid later in life, you may often have to pay penalty fees too. But if you are already on a medical aid, you can add gap cover and just pay the over-65-year-old rates without incurring penalties.
Do retirees need a life insurance policy or life cover?
Life insurance policies and life cover can provide financial support for your family, cover funeral expenses, and help manage retirement funds. It’s especially valuable if you have dependents or a spouse.
What is funeral cover, and do seniors need it?
Funeral cover pays out quickly to cover funeral expenses, easing the financial pressure on your loved ones. It’s a practical choice for retirees and people with elderly parents/loved ones.
How do pre-existing medical conditions affect insurance for retirees?
Some policies may have waiting periods or exclusions for pre-existing medical conditions. Always review the terms and ask your provider for details about instant cover and right cover for your needs.
What is critical illness cover and disability cover for seniors?
Critical illness cover pays a lump sum if you’re diagnosed with a serious illness, providing financial support and assistance with medical expenses during recovery. Disability cover and severe illness cover are also important for seniors facing a medical crisis or terminal illness.
What is the maximum age for insurance cover?
Age limits vary by provider and policy. We advise checking with your adviser for details about maximum age and insurance cover options.
When In Doubt, Broker It Out
Insurance brokers are essential advocates for individuals who struggle with navigating complicated online platforms and the sheer volume of providers when selecting an insurance provider.
Brokers also provide informed guidance on everything a policy offers, helping you understand if it’s the best fit for you. Brokers explain policy terms in plain language, ensuring people don’t overpay or sign up for the wrong cover while looking to secure essential protection.
This can be essential for over-65s looking for insurance options, as a Broker would know which policies you would qualify for.
TRA’s Commitment to Retirees
Total Risk Administrators (TRA) is dedicated to supporting South African retirees with an insurance solution that truly makes a difference. Retirement should be a time to enjoy life, not worry about unexpected costs, medical expenses, or financial hardship.
By signing up for TRA Gap Cover, you can ensure your health, finances, retirement funds, and family are looked after.
To learn more about TRA’s products, browse our website today.
