The pre-retirement insurance checklist

By Tom, CPA · Updated October 25, 2026

TL;DR: Your employer quietly provides health, life, disability and sometimes other coverage. When you quit, most of it ends. In the year before you retire, line up replacement health coverage, convert or replace life insurance as needed, use disability coverage while you still can, raise liability limits, decide on long-term care, and follow a timing table so nothing lapses.

Educational only, not tax, legal, or investment advice. Examples are illustrations, not predictions. Rules and limits change; verify current figures and talk to a qualified professional about your situation.

Employer benefits are easy to take for granted because they're automatic. Early retirement turns them off at once, often at the end of the month you leave, sometimes on your last day. Some coverage can be continued or converted, but only within deadlines. Others need to be replaced before you leave, while you still have income and possibly better access to underwriting.

This checklist walks through health, life and disability, property and umbrella, and long-term care, then pulls it all into a timing table.

CPA Warning Label: Review your insurance before your employer stops paying for it. Your last day at work is a terrible day to discover your life insurance ended at 11:59 p.m.

Health

1. Find out when employer coverage ends: last day of work or end of month.
2. Compare COBRA and the Marketplace. Losing job-based coverage generally qualifies you for a Special Enrollment Period on HealthCare.gov, and you can usually report the loss up to 60 days before it happens so new coverage starts without a gap. See COBRA vs ACA.
3. Estimate your retirement-year income for premium tax credits. Your final paychecks count toward that year's income, so a mid-year retirement often makes the first year's subsidy small. See the subsidy cliff guide.
4. Check networks and drugs for any plan you're considering.
5. Schedule care while on the employer plan, especially if you've met the deductible.
6. Max out HSA contributions for the months you're eligible and keep receipts.
7. Use FSA balances before coverage ends; unused amounts may be forfeited.
8. Plan for Medicare if you're close to 65: your Initial Enrollment Period starts three months before the month you turn 65.

Life and disability

1. List all employer life coverage and check whether it can be converted or ported, and by when.
2. Re-run your life insurance gap. If your portfolio now supports your family, you may not need replacement coverage. If you do, consider buying individual term before you leave. See term life for FIRE.
3. Disability: once you stop working, there's no income to insure. If you're planning a few years of part-time work, consider whether you need individual coverage; group disability usually ends with employment.
4. Accidental death and other employer extras usually end too; don't replace them just because they existed.
5. Update beneficiaries on everything you keep, including rollovers. See the beneficiary audit.

Property and umbrella

1. Raise auto and home liability limits to the levels an umbrella requires.
2. Buy or increase umbrella coverage to reflect your net worth, especially taxable accounts. Without a paycheck, judgments target assets. See umbrella insurance.
3. Review deductibles. With a strong emergency fund, higher deductibles can cut premiums.
4. Update your auto policy for lower mileage after you stop commuting; some insurers price this in.
5. Plan for travel or a move: long absences from your home may affect homeowners coverage; tell your insurer.
6. Check business coverage if you'll consult or freelance.

LTC

Long-term care is the biggest uninsured risk for many retirees. According to LongTermCare.gov, someone turning 65 today has almost a 70% chance of needing some type of long-term care services, though about one-third may never need care. Decide your approach before you leave work, while you can still evaluate options calmly:

1. Decide whether to self-insure, buy traditional or hybrid coverage, or rely on family and Medicaid as a last resort.
2. If you might buy a policy, apply while you're healthy; underwriting gets harder with age.
3. Check whether your employer offered group LTC coverage that's portable.
4. Factor potential care costs into your plan. See long-term care planning.

Timing table

Illustration: the June retiree

Illustration: Carmen, 52, single, retires June 30 after earning $90,000 in the first half of the year. Her employer health plan ends June 30. Her income for the year is already above 400% of the federal poverty level for a single person ($62,600 for 2026 coverage), so she won't get a premium tax credit for July through December. She compares COBRA for six months with an unsubsidized Marketplace plan, picks the Marketplace plan because it's cheaper and her doctors are in network, and reports her coverage loss in May so it starts July 1. She keeps her $25,000 portable group life coverage only after comparing it with cheaper individual term, bumps her umbrella to $2 million, and lets group disability lapse because she no longer needs income protection. For the next year, with a planned MAGI of about $45,000, she'll qualify for a credit.

Documents to collect before your last day

• Summary plan descriptions for health, life and disability coverage, with end dates
• Conversion or portability forms for group life, with deadlines
• Your final pay stubs, for estimating the year's income for premium tax credits
• HSA and FSA account statements and claims deadlines
• Contact information for the benefits administrator, since HR may be harder to reach after you leave
• Any retiree benefit details, such as retiree health or life coverage, if offered

Store copies with your other financial records. Questions about benefits often come up months later, when the COBRA notice arrives or a claim is denied, and having the documents saves a lot of phone time.

Couples with different timelines

If one spouse keeps working, their employer plan may cover the retiring spouse, which can be the simplest bridge. Compare the added cost of spousal coverage with a Marketplace plan, keeping in mind that an affordable offer of employer coverage to family members can affect premium tax credit eligibility. When the second spouse retires, run this checklist again.

Common mistakes

• Missing a conversion deadline for group life coverage
• Assuming COBRA is the only option, or the best one
• Forgetting that your first year's income includes salary when estimating subsidies
• Letting an umbrella lapse because underlying auto limits changed
• Not reading the plan documents for exact end dates