Any family helping or caring for someone with mild cognitive impairment or dementia should consider the addition of an “Umbrella” policy.
In a Kiplinger article titled Why You Need an Umbrella Policy, they share that “adding extra liability coverage to your auto- and homeowners-insurance policies can protect your finances from expensive lawsuits.” Umbrella policies are designed “to help protect you from major claims and lawsuits and as a result it helps protect your assets and your future. It does this in two ways: Provides additional liability coverage above the limits of your homeowners, auto, and boat insurance policies.”
In the early stages of my parent’s dementia, when they didn’t quite recognize they were having trouble, I helped my dad add an Umbrella policy to their coverage. They had auto- and homeowners insurance, but I was concerned that the might be responsible for something that would jeopardize their retirement savings. I figured they would need every penny of their money to pay for their care.
One issue we faced early was that my dad was driving without a valid license. Their doctor had submitted the paperwork to have both of my parents licenses revoked. For some reason, they only thought my dad had his license revoked, even though they both received a letter. They practiced what they would tell the police if they were pulled over. I was pretty sure the auto-insurance wouldn’t cover them since their licenses were revoked, so I prayed that nothing would happen. If it did, I hoped the umbrella insurance would help protect their assets to pay for the years of care they would be needing.
Later, at a happy hour at my parent’s retirement community, my dad fell over onto a woman and sent her to the ER. Thankfully, she knew my dad and she nor her family pursued a lawsuit. However, I could only imagine how quickly all of their assets could disappear in legal fees and an award.
If you are are caregiver, two things to do to protect your loved one and their assets:
- Contact your insurance agent and have an open discussion about your concerns to find the type of policy that could best protect you and your loved ones.
- Contact your estate lawyer. A Trust might be a solution to help protect your assets …. but I’m NOT a lawyer …. so please find a local elder care attorney who can help you navigate the coming years.
Dementia is a cruel beast and it steals so much from the individuals it preys upon, and the loved ones caring for them. I hope the suggestion on how to deal with practical issues to protect your loved ones will help you and your family.
If you are caring for a loved one with dementia, you can visit the my other blog DealingWithDementia.org.