Securing Your Midlife Gap Year: Insurance Essentials

You’re embracing the idea of a midlife gap year. You’re picturing the landscapes, culture, and bucket list experiences in your mind. But unattended business is holding you back from peak excitement.

You need proper insurance in case something goes wrong.

When you’re taking a career break it’s tempting to ignore that responsible voice in your head. But if you do, this thrilling chapter of your life will be written with unnecessary risks. Now’s the time to take inventory of your coverage, and fully protect the adventure of your lifetime.

Credit Card travel insurance

It’s time to check the fine print on your credit card’s terms and conditions. Your credit card travel insurance should reimburse some travel expenses (associated with the card) in the event of trip disruptions and cancellations. Your card’s benefits may include:

• Financial Coverage: Should a qualifying event (ex: storm, medical emergency) ruin your travel plans, you may be eligible for flight and hotel reimbursements.
• Evacuation Coverage: If you need to be evacuated from your vacation spot, you may be eligible for reimbursements after getting out.
• Supplemental Medical Coverage: If you incur medical costs outside the country, you may be eligible for reimbursements even if your primary health plan doesn’t provide coverage.

Get in touch with your credit card provider. And make sure to have conversations around what family members are covered, what levels of coverage are offered, and what events qualify for your credit card travel insurance to kick in.

Health insurance

Whether or not your domestic health insurance policy’s coverage extends internationally is something you’ll want to check before you leave the U.S.  If it does not or if you want additional coverage, there are a few ways to help keep yourself covered healthwise while traveling:

• Purchase Individual Travel Insurance: A travel medical insurance policy can protect you when traveling domestically and internationally. It offers medical coverage when you’re out of network, and is only valid for the duration of your trip(s).
• Check Credit Card Travel Insurance: Remember, your credit card travel insurance may provide reimbursements for medical costs while you’re traveling abroad. These payments can be put towards your primary health plan’s deductible.
• Purchase Flexible Airline Tickets: In response to the Coronavirus many airlines adopted flexible tickets. Of course, airline offerings vary, and fees will likely re-emerge as more people travel again. Make sure you know what’s covered when you purchase your tickets.  You may have the option to pay an additional fee for the ability to get a full refund.

Disability insurance

A break from your career isn’t a break from the thrill of life. Many of our clients take their adventurous spirits with them as they travel. Whether it’s spelunking, white water rafting, or skiing, they make their midlife gap year one to remember.

But you still need to be prepared for worst case scenarios. Not just because it protects you from the storm, but also because it allows for peace of mind. With disability insurance, you’re able to protect you and your loved ones in a time you may need it most. Should you become disabled during your career break, you may not be able to return to work. With disability insurance in place, you can protect some income.

Keep in mind that if you have disability insurance through your employer, you will no longer be covered if you leave your job. If you do not have a policy and you want to get independent coverage, you need to do so while you have income. Certain limits and restrictions can apply to how much of your income you are able to protect.

Life insurance

Without a doubt, this is the hardest insurance to think about. But you can’t skip over it before your gap year travels. A life insurance policy allows you to protect your spouse, children, and other loved ones in the event of your death.

If you don’t already have a policy in place, now’s the time to consider one. And make sure to do your due diligence on what policy type is best for you. If you already have life insurance, consider reviewing your beneficiary designations and adding supplemental coverage.

Please note: If you purchase a new life insurance policy, it will have to go through underwriting. This process generally takes between 4 to 6 weeks (sometimes longer). If this approval process infringes on your travel plans, you can also purchase temporary life insurance. This ensures your beneficiaries receive a full payout should you pass before your policy becomes active.

Umbrella insurance

Umbrella insurance provides extra protection in cases where your liability exceeds the coverage(s) you have in place. For example, if you’re at fault in a car accident, umbrella insurance can kick in to cover costs after your auto insurance policy’s coverage maxes out.

Without umbrella insurance, other assets like your savings or home equity can become collateral when paying damages. One expensive lawsuit may jeopardize the security of your retirement.

Thankfully, umbrella insurance has your back in cases where you need more protection. It can also cover certain lawsuits (ex: libel, slander, character defamation, and privacy invasion), legal defense costs, and incidents outside the country.

Worries over a potential car wreck (or lawsuit) can spoil your gap year adventure. But with umbrella insurance, you give your career earnings and future retirement room to breathe as you check off travel locations.

How The Advisory Group can help you further

At The Advisory Group, we love watching our high-performing clients take the time off they deserve. We’ve seen firsthand how a midlife gap year can clear the mind, reaffirm values, and revitalize a person’s passion for work.

But in order to enjoy your career break properly, you need to have the proper protections in place. That means making sure your insurance has you covered when traveling domestically and abroad.

If you’re considering, preparing for, or embarking on a career break, we’d love to talk. Feel free to schedule your complimentary consultation, or calling us directly at (415) 977-1200

Important note:  We do not sell insurance.  We provide this information for guidance to help protect you and your family against catastrophic loss.