At this time of year, you may have received notices about Open Enrollment at your place of business. Before you sign up for a life insurance policy, it’s important to consider a few of your options. The group life insurance plans offered by your company may not be enough to keep your family secure. Let us explain.
What is Open Enrollment?
Open enrollment allows employees to enroll in or make changes to their benefit plans during a limited time period. Generally, these changes cover benefits like health insurance, dental, vision, and life insurance. During these weeks, employees can enroll in benefits for the first time, change their current coverage plans or amounts, or drop coverage they feel they don’t need. It’s important to understand that these decisions can have a significant financial impact.
When it comes to life insurance, open enrollment provides a great opportunity to reconsider coverage, enroll dependents or edit coverage for dependents, or designate a beneficiary. If you’re unsure about your life insurance coverage in any way, now is the time to consult an expert.
The Pros and Cons of Group Life Insurance
Choosing a group life insurance plan with your employer may or may not be beneficial, depending on your health and financial situation. On one hand, group life insurance is relatively easy to obtain. All you have to do is enroll, and you’ll be insured for as long as you’re employed by your company. This may be a good option if you are a smoker or if you have preexisting health conditions.
You’ll want to be aware, however, that there are conditions associated with group life insurance plans. For instance, premiums on these types of plans generally increase, either once per year or once every five years. In addition, group life insurance plans are usually not portable. That means that if you leave your employer, you can lose your life insurance coverage. Given these conditions, it’s important to research all of your options, including individual life insurance policies. It may make sense to add additional coverage.
Why a Blended Approach May Make Sense For Your Family
Depending on your place of work, you could have several life insurance options to choose from. You may not be limited to the coverage provided by your employer, however. In fact, you can consider various other options, such as a separate individual term policy, which is independent of your employer.
This blended approach allows you to maintain both a group and individual life insurance coverage. Why does this matter? First of all, it allows you to hold onto your coverage, whether you’re employed or not. This will ensure that your family is protected, even if you retire or pass away unexpectedly while transitioning from job to job. Second of all, it gives you a policy premium that will remain level for a longer duration of term – usually between ten and forty years.
A Few Final Thoughts about Life Insurance
We recommend that consumers get a life insurance policy that amounts to ten times their current income. If you are unsatisfied with what your current employer offers in terms of life insurance, or if you are worried you will be inadequately covered in case of an emergency, let us know. We’re happy to help you make the best choice for you and your family.
