Talking to Your Parents About Insurance

Are your parents adequately protected against financial loss? What if your parents' home burns down and there is insufficient insurance to cover the entire loss--can they come live with you? What if one of your parents is held liable for someone's injuries, but does not have liability insurance--will he or she be financially ruined? What if a parent becomes seriously ill and needs long-term care--will he or she have the financial resources to pay for this contingency? What if one of your parents dies unexpectedly--will the surviving parent have enough money to live on?

If you're a member of the baby-boom generation, your parents may be of an age where these concerns may be troubling you. The only way to get the answers and ease your worries is to have a heart-to-heart talk with your mother and father. This may not be easy for some people, but if you shy away from this topic, the consequences could be devastating. Your parents were there to talk to you about the tough issues--now you need to be there for them. How you choose to approach them will depend on the type of relationship you share (e.g. adversarial, open and warm). Here are some tips on how to break the ice:

Prepare for resistance
Your parents may find inquiries regarding insurance intrusive, regardless of the fact that you're trying to help. They may feel it's none of your business, or that it's demeaning for you to assume they haven't made the proper arrangements. Be prepared to explain that you're simply concerned about their well-being and don't mean to be nosy or presumptuous.

Keep it private
A discussion about insurance involves issues that are personal. Broaching the subject in a restaurant or other public setting is inappropriate. Keep the conversation private, and choose a setting where your parents feel comfortable--at their own kitchen table over a cup of coffee, for instance. Also, don't rush the conversation. Even though you shouldn't expect to finish or resolve anything during the initial exchange, be sure you've set aside enough time to comfortably address everyone's concerns.

There's safety in numbers
If you have siblings, encourage a group discussion. If your parents see that all of you feel bly, they may be more amenable to talking openly and considering your advice. If that's not possible, at least talk to your siblings about your parents' situation. Of course, if you have a sibling who is particularly good at rubbing your parents the wrong way, then perhaps you will want to exclude him or her from the discussion.

Be direct
Sometimes, the best approach is to put all your cards on the table from the get-go. If this is an option for you, find the right time and place, then just say, "Mom and Dad, we need to talk..."

The "I have a friend" approach
If a more subtle method is to your liking, you might describe an experience (real or hypothetical) that illustrates the consequences of not being adequately insured. For example, you could say something like: "Joe's father went into a nursing home a few years ago. His father didn't have long-term care insurance, so now Joe has to sell his father's house."

Discuss your own plans
Another indirect strategy is to talk about your own insurance needs or plans. Once the discussion is under way, you can steer the subject in the direction of your parents' insurance needs.

Ask for their advice
Parents are used to giving advice to their kids, not getting it from them. Start by asking them what they think you should do about a particular insurance issue. For example, you might ask if they think you should increase your life insurance now that a grandchild has been born, or drop the collision coverage on your 10-year-old car. From there, you can divert the topic to their own insurance needs.

Ask a simple question
Another "lead-in" approach involves asking a seemingly innocent question, such as: "Who is your insurance agent?" or "do you keep your insurance policies in case of an emergency?" Whatever answer your parents give will be an opening for you to ask other questions that are on your mind.

Bring in the big guns
Perhaps not during the first discussion, but at some point in time you may want to make an appointment with your (or your parents') insurance agent for an evaluation of your parents' insurance situation and needs.

Be patient
Realize that this process takes time. Your parents may need to think things over, and it may take several discussion sessions to work out all the details.

Follow your parents' wishes
Finally, remember that just because your parents have agreed to let you help doesn't mean that you can take charge and do things your own way. You should act only when and how your parents want you to.

Issues to talk about
Once you have successfully begun a dialogue with your parents about insurance, make sure you cover all the pertinent issues. Here are some you should not miss:

• What policies do they currently have?
• What policies do they have, but no longer need?
• What policies don't they have, but need?
• What are the details of their current policies?
• Do their current policies provide adequate coverage? too much coverage?
• How much can they afford to pay for premiums?
• If there are beneficiaries, are the proper persons named? Have the proper designation forms been completed?
• Who should be responsible for paying the premiums (you or your parents)?
• Where are the policies kept?
• Who is their insurance agent?

In addition, make sure you address each type of insurance that may be important for your parents, which may include:

• Health insurance
• Long-term care insurance
• Life insurance
• Homeowners insurance
• Auto insurance
• Disability insurance (though this may not be important if your parents do not have job earnings to replace)