The Peak 65 Retirement Wave: A Complete Insurance Planning Guide

The United States is in the middle of the largest retirement wave in its history. Approximately 4.1 million Americans are turning 65 each year from 2024 through 2027, a phenomenon researchers call "Peak 65." That is roughly 11,200 people every single day reaching the age most closely associated with Medicare eligibility, Social Security benefits, and the transition from employer-sponsored insurance to retirement coverage. The sheer scale of this demographic shift is reshaping insurance markets, straining enrollment systems, and creating urgent planning needs for millions of families.

If you are approaching 65 or have recently crossed that threshold, the insurance decisions you make right now will affect your financial security for the rest of your life. Missed enrollment windows can trigger permanent penalties. Choosing the wrong Medicare path can lock you into higher costs. Overlooking supplemental coverage gaps can expose you to catastrophic expenses that Medicare was never designed to cover. This guide provides a complete insurance planning framework for the Peak 65 generation, from six months before your 65th birthday through the years that follow.

What Peak 65 Means for Insurance Markets

The baby boomer generation, born between 1946 and 1964, is the largest generation in American history until the millennials. The oldest boomers turned 65 in 2011, but the peak of the wave is happening right now. The Alliance for Lifetime Income coined the term "Peak 65" to describe the years 2024 through 2027, when the annual number of Americans reaching 65 hits its all-time high. By the time the wave crests, more than 12,000 people will be aging into Medicare eligibility every day during peak months.

This demographic surge affects insurance markets in several measurable ways. Medicare enrollment is growing faster than at any point in the program's history, placing pressure on CMS to maintain plan quality and network adequacy. Medicare Advantage carriers are competing aggressively for new enrollees, which has expanded plan options but also raised questions about benefit sustainability. The Medigap market is seeing increased demand during the six-month open enrollment window that follows Part B enrollment. Long-term care insurance carriers, already reduced in number after years of losses, face a population that increasingly needs their product but often cannot afford it or qualify medically.

For individual consumers, the practical impact is this: the decisions you face at 65 are more complex and consequential than ever, and the volume of people making those same decisions simultaneously means that resources, agents, and enrollment assistance can be stretched thin. Starting early and having a clear plan is essential.

The Complete Insurance Checklist for New Retirees

Whether you are six months away from turning 65 or have recently enrolled in Medicare, the following checklist covers every major insurance decision you need to address. Work through each item systematically. Some require action during specific enrollment windows, while others can be addressed at any time.

1. Medicare Enrollment (Parts A and B)

Medicare Part A covers hospital stays, skilled nursing facility care, hospice, and some home health services. Most people qualify for premium-free Part A based on their work history or their spouse's work history. Medicare Part B covers doctor visits, outpatient care, preventive services, and durable medical equipment. The standard Part B premium is $185.00 per month in 2026, with higher-income enrollees paying more through IRMAA surcharges. Your Initial Enrollment Period begins three months before your 65th birthday month and ends three months after. Missing this window without qualifying coverage can result in a 10 percent penalty on your Part B premium for each 12-month period you were eligible but not enrolled, and that penalty lasts for life. For a step-by-step walkthrough of the enrollment process, see our turning 65 Medicare checklist.

2. The Medigap vs. Medicare Advantage Decision

This is the single most important insurance decision most new retirees face. You have two primary paths: stay on Original Medicare and add a Medigap supplement policy plus a standalone Part D drug plan, or enroll in a Medicare Advantage plan that bundles hospital, medical, drug, and often dental and vision coverage into one plan. Original Medicare with Medigap provides unrestricted access to any provider who accepts Medicare, no referral requirements, and minimal to zero cost-sharing depending on the plan you choose. The trade-off is higher monthly premiums. The most popular Medigap plan, Plan G, typically costs $150 to $300 per month depending on your location, age, and the carrier.

Medicare Advantage plans often have $0 or low monthly premiums beyond the Part B premium. They frequently include dental, vision, hearing, fitness benefits, and over-the-counter allowances. However, they use provider networks (HMO or PPO), may require prior authorization for certain services, and expose you to cost-sharing up to an annual out-of-pocket maximum that can be as high as $8,850 in 2026. Your Medigap Open Enrollment Period, the six months starting from the first day of the month you are both 65 and enrolled in Part B, is your one guaranteed-issue opportunity to buy Medigap without medical underwriting. If you pass up Medigap initially and later want to switch from Medicare Advantage, you may face health questions and potentially be denied coverage.

3. Part D Prescription Drug Coverage

Even if you take no prescription medications today, enrolling in a Part D plan when you are first eligible is strongly recommended. If you go without creditable drug coverage and enroll later, you will pay a late enrollment penalty of 1 percent of the national base premium for each month you lacked coverage, added to your premium permanently. Part D plans vary significantly in formulary coverage, pharmacy networks, and tier structures. The Inflation Reduction Act capped annual out-of-pocket Part D spending at $2,000, which provides meaningful protection, and also introduced the Medicare Prescription Payment Plan that lets you spread costs across monthly installments. Use the Medicare Plan Finder at Medicare.gov to compare plans based on your specific medications. For details on the enrollment process, review our guide on how to apply for Medicare.

4. Dental, Vision, and Hearing Coverage

Original Medicare does not cover routine dental care, eye exams for glasses, eyeglasses, contact lenses, or hearing aids. These are among the most common healthcare needs for adults over 65. A single dental crown costs $800 to $1,500. Hearing aids average $2,000 to $4,000 per pair. If you choose Original Medicare with Medigap, you will need standalone dental, vision, and hearing plans. Many Medicare Advantage plans include these benefits, but coverage depth varies widely. Some cap dental benefits at $500 to $1,000 annually, which is quickly exhausted by major procedures. Evaluate your specific needs and compare what bundled versus standalone plans actually cover. For a detailed breakdown of every coverage gap retirees commonly face, see our retirement insurance gaps checklist.

5. Life Insurance Review

Retirement is the right time to reassess your life insurance. If you carried a large term policy to protect your family during your working years, it may be expiring or becoming prohibitively expensive to renew. The question is whether you still need coverage and how much. If your spouse would lose a significant portion of household income upon your death, whether through reduced Social Security, the loss of a pension, or the need to draw down savings faster, life insurance can fill that gap. Final expense or burial insurance, with benefits of $5,000 to $25,000, can cover funeral costs averaging $8,000 to $12,000 and prevent survivors from bearing that cost out of pocket. Some retirees also use permanent life insurance as part of an estate planning or legacy strategy.

6. Long-Term Care Planning

Long-term care is the largest uncovered financial risk in retirement. Medicare does not cover custodial care, which is the ongoing help with daily activities like bathing, dressing, and eating that makes up the majority of long-term care. An estimated 56 percent of people turning 65 today will need some form of long-term care. A private room in a nursing home averages over $131,000 per year. Assisted living averages about $64,000 per year. Home health aides cost roughly $75,000 per year for full-time care. Without a plan, these costs can consume a lifetime of savings in just a few years. Options include traditional long-term care insurance, hybrid life and LTC policies that guarantee a death benefit if care is never needed, annuity-based LTC riders, and Medicaid planning for those with limited assets. The Peak 65 wave is intensifying pressure on an already shrinking LTC insurance market, making it important to explore your options while you are still healthy enough to qualify. For a deeper analysis of whether LTC insurance is the right fit, read our guide on whether long-term care insurance is worth it.

7. Annuity Income for Guaranteed Cash Flow

One of the greatest risks in retirement is outliving your savings. Annuities can provide a guaranteed income stream that lasts for life, functioning as a personal pension. A fixed annuity offers a predictable payout. An indexed annuity ties returns to a market index with downside protection. A qualified longevity annuity contract, or QLAC, can be funded with up to $200,000 from a qualified retirement account and begin payments at a later age, such as 80 or 85, to protect against late-life income needs. For retirees in the Peak 65 wave who lack a traditional pension, annuities can anchor a retirement income plan and provide the security needed to cover insurance premiums, healthcare costs, and daily expenses regardless of market conditions.

8. Supplemental Coverage: Hospital Indemnity, Critical Illness, and Accident Insurance

Even with Medicare and a supplement or Advantage plan, gaps remain. Hospital indemnity insurance pays a fixed cash benefit when you are admitted to the hospital, helping cover deductibles, travel for treatment, and lost income for a caregiving spouse. Critical illness insurance provides a lump-sum payment upon diagnosis of a covered condition like cancer, heart attack, or stroke, giving you flexibility to pay for uncovered treatments or non-medical expenses. Accident insurance covers costs associated with injuries from falls, auto accidents, or other incidents, which become more common with age. These products are generally affordable, with premiums often between $20 and $75 per month, and they pay benefits directly to you regardless of what other insurance covers. For a comprehensive overview of how these products work together, see our supplemental insurance for retirees guide.

Your Timeline: What to Do and When

Six Months Before Turning 65

Begin by gathering information. Research whether Original Medicare with Medigap or Medicare Advantage is the better fit for your health needs, provider preferences, and budget. Make a list of your current medications and use the Medicare Plan Finder to compare Part D plans. Assess your dental, vision, and hearing needs and start comparing standalone and bundled coverage options. If you are still working and have employer coverage, contact your benefits department to understand how your group plan will coordinate with Medicare. Review your life insurance policies to determine what expires, what converts, and what you still need. Start conversations about long-term care planning if you have not already. Evaluate whether an annuity could provide useful guaranteed income. This is also the time to check your Social Security statement and decide when to begin claiming benefits, as that decision interacts with Medicare enrollment.

At Age 65: During Your Initial Enrollment Period

Enroll in Medicare Part A and Part B. If you are choosing Original Medicare, apply for Medigap during your six-month open enrollment window, when you have guaranteed issue rights and cannot be turned down or charged more for health conditions. Select and enroll in a Part D drug plan. If you are choosing Medicare Advantage, enroll in a plan that includes drug coverage and evaluate its dental, vision, and hearing benefits against your needs. Enroll in any standalone dental, vision, or hearing plans needed to fill gaps. Apply for supplemental products like hospital indemnity, critical illness, or accident insurance. Complete any long-term care insurance applications while you are still in a favorable underwriting age bracket. Set a calendar reminder to review all of your coverage during the Medicare Annual Enrollment Period each fall.

After 65: Ongoing Annual Reviews

Your insurance needs will change as you age. Review your Medicare coverage each year during the Annual Enrollment Period from October 15 to December 7. Part D formularies change annually, and a plan that was optimal last year may not be the best choice this year. If you are on Medicare Advantage, evaluate whether your plan's network, benefits, and costs still align with your needs. Reassess life insurance periodically, particularly if your financial situation changes through inheritance, the death of a spouse, or changes in debt levels. Revisit long-term care planning every few years, especially if your health status changes or new products become available. Check whether your supplemental products remain cost-effective relative to the protection they provide.

Common Mistakes New Retirees Make

The complexity of retirement insurance decisions leads to predictable errors. Understanding the most common mistakes can help you avoid them. First, many new retirees miss their Initial Enrollment Period for Medicare because they assume coverage starts automatically or because they are confused by overlapping enrollment windows. The resulting late enrollment penalties for Part B and Part D are permanent, adding to your premiums for life. Second, a significant number of retirees skip Medigap during their guaranteed-issue window. If you later develop a health condition and want to switch from Medicare Advantage to Original Medicare with Medigap, insurers can deny your application or charge significantly higher premiums in most states.

Third, many retirees assume Medicare covers dental, vision, and hearing, and are surprised when they face thousands of dollars in out-of-pocket costs for crowns, dentures, glasses, and hearing aids. Fourth, the belief that Medicare covers long-term care is one of the costliest misunderstandings in retirement planning. Medicare covers only short-term skilled nursing care after a qualifying hospital stay, not the custodial care that constitutes most long-term care needs. Fifth, retirees often drop all life insurance without evaluating whether a surviving spouse would experience a meaningful income reduction. Sixth, some retirees fail to enroll in Part D because they are healthy and take no medications, not realizing the late penalty accrues for every month they go without creditable coverage.

Finally, one of the most pervasive mistakes is treating insurance decisions as one-time events rather than ongoing management responsibilities. Your health changes, plan offerings change, premiums change, and your financial situation evolves. Reviewing coverage annually is not optional. It is a core component of sound retirement financial management.

How the Demographic Wave Affects Premiums and Availability

The Peak 65 wave does not affect all insurance markets equally. Medicare Part B premiums are determined by CMS based on aggregate program spending projections and are the same nationwide for enrollees at a given income level. The influx of new enrollees alone does not directly raise Part B premiums, though the broader trend of rising healthcare costs does. Medicare Advantage premiums in competitive markets may actually remain low or decrease as carriers compete for the massive wave of new enrollees, though this competition can lead to benefit design changes that reduce coverage quality over time.

Medigap premiums are more directly affected. In states that use attained-age rating, which is the most common method, premiums increase as you get older. A larger cohort of aging enrollees means the overall risk pool shifts upward, which can lead to rate increases. Additionally, if more boomers opt for Medicare Advantage initially and then switch to Medigap later outside their guaranteed-issue window, they may face higher premiums or denials, which concentrates the Medigap pool among those who enrolled early.

The long-term care insurance market faces the most significant impact. The number of carriers offering standalone LTC policies has declined from over 100 to fewer than a dozen over the past two decades. The Peak 65 wave is bringing millions of people into the age range where long-term care becomes a realistic concern, yet the supply of products to insure against it is contracting. This supply-demand imbalance means premiums will likely continue to rise, underwriting standards will remain strict, and applicants in their late 60s and 70s will find it increasingly difficult to qualify. Hybrid life and LTC products have partially filled the gap, but they require larger upfront premiums or single-premium payments that are not accessible to everyone.

Dental, vision, and hearing markets are expanding in response to demand. More carriers are offering standalone and bundled plans for seniors, and Medicare Advantage plans are enhancing these benefits to attract enrollees. This increased competition generally benefits consumers through more options and competitive pricing, though retirees should still carefully compare plans to ensure the coverage meets their actual needs rather than just checking a box.

Making Your Plan

The Peak 65 wave is not a crisis for individual retirees. It is a demographic reality that underscores the importance of proactive planning. The insurance decisions you make at 65 establish the foundation of your financial protection for the next 20 to 30 years. Approach them with the same diligence you would give to any major financial commitment.

Start six months early. Enroll in Medicare on time. Make the Medigap versus Medicare Advantage decision with full information. Secure Part D coverage immediately. Address dental, vision, and hearing needs. Review your life insurance. Develop a long-term care strategy. Consider guaranteed income through annuities. Evaluate supplemental products that fill the remaining gaps. Then commit to reviewing everything annually.

The 4.1 million Americans turning 65 each year are all navigating the same complex landscape. Those who plan early, act within enrollment windows, and build a layered coverage strategy will be positioned to manage their healthcare costs with confidence. Those who wait, assume, or ignore gaps will discover them at the worst possible moment, when they need care and the bills arrive. Be in the first group.