Tuesday, January 24, 2017, PM | Leave Comment
Taking out a life insurance policy through work is a marvelous way to protect your family.
While no one likes to think about the inevitable, leaving your loved ones with no financial resources to fall back on after your death can be devastating.
Taking out a new policy raises some questions which will help to determine if the policy is right for you.
Where is the Insurance Coming From?
Your employer will often work with one specific life insurance company. They might be doing this because of low rates or protection coverage, but you still need to know which company your insurance is coming from.
You can then do some research on the company to determine if the plan is worth the commitment.
You can also purchase outside of your work, but it pays to know what companies are the best before you do.
Are There Living Benefits?
Not all policies are specific to the eventual death of an individual.
Many life insurance plans allow the living to benefit from the plan as soon as they begin to pay for it.
These insurance plans allow policyholders to withdraw money, helping with financial obstacles the person faces during their lifetime.
How Much is This Going to Cost?
Once you sign up for life insurance, the amount to pay the policy is deducted for each of your future paychecks.
While this is an easy and convenient way to pay for coverage, it can be costly if you don’t know how much it is going to be.
If the policy costs just a few dollars per pay period, it shouldn’t be a problem.
If the insurance costs an eighth or a quarter of your salary, there might be an issue.
What are the Guarantees?
You want to know what guarantees are involved when taking out the insurance.
Will your spouse or beneficiary be paid in a timely manner after your death?
Will there be a loss counselor available to your family to help them in coping with loss as part of the insurance agreement?
Knowing these important factors will determine if you’re paying for a good policy or a mediocre one.
Is Health a Factor?
Sure, your life insurance premium is low right now, but what happens if your health changes and you get very sick? You need to know the specifics from your employer of insurance alteration, which involves the time in which a premium changes because of your state of health.
Will the Benefits Adjust According to Inflation?
Inflation determines the overall cost of living for individuals in the country. If you take out a policy in the current moment, it’ll be nice to know if the benefits paid out 50 years from now will increase due to the rising cost of living.
Asking your employer all these questions guarantees that you’ll be paying for a life insurance policy you can trust. You shouldn’t be paying a premium for a policy you know nothing about.
Not all life insurance is created equally and choosing the right company can mean the difference between a financially-stable family and one that is struggling to live because of the death of a loved one.
Eileen O’Shanassy is a freelance writer and blogger based out of Flagstaff, AZ. She writes on a variety of topics and loves to research and write. She enjoys baking, biking, and kayaking. Check out her Twitter @eileenoshanassy.