Life Insurance

[Ivan Putski]

Originally Posted by The_Bishop

In the best of all worlds, you would avoid being rated individually at all. Look around to see if you can't qualify for some group term life insurance plan or other. Work, church, credit union, clubs. Many such organizations offer life insurance plans to members or employees.

For most, group life coverage won't be enough. They may allow you to get supplemental coverage for 3x, 4x or 5x salary but is that enough if you have a sizable mortgage, large family etc.? Furthermore, most of these group policies are not portable so once you leave your job, you lose your coverage. Are you willing to take the chance of not being covered while you look for a new job?

What happens if you've been under group coverage since you're 28 and get laid off when you're 41 or you need to leave your job because of health problems? Good luck trying to get comparable priced term coverage at 40+years old and in the 2nd scenario where you have a health problem? You'd be hard pressed to find an insurance company that'll cover you.

[Caltovegas]

Don't forget to also consider conversion options and living benefits such as terminal or critical illness riders. Your agent should tell you about all options and riders.

[The_Bishop]

Originally Posted by Ivan Putski

For most, group life coverage won't be enough. They may allow you to get supplemental coverage for 3x, 4x or 5x salary but is that enough if you have a sizable mortgage, large family etc.?

If you can afford a large mortgage and a large family, chances are that 5x your salary (tax free) is going to go quite a long way.

Originally Posted by Ivan Putski

Furthermore, most of these group policies are not portable so once you leave your job, you lose your coverage. Are you willing to take the chance of not being covered while you look for a new job?

Most major underwriters provide options for portability, convertibilty, or both.

Originally Posted by Ivan Putski

What happens if you've been under group coverage since you're 28 and get laid off when you're 41 or you need to leave your job because of health problems? Good luck trying to get comparable priced term coverage at 40+years old and in the 2nd scenario where you have a health problem? You'd be hard pressed to find an insurance company that'll cover you.

Portability is most often provided through age 70. Trying to fly solo is a nice way to increase your fees and premiums over what they would be in a group world. Virtually all of the same products are available in both places.

[The_Bishop]

Originally Posted by Caltovegas

Don't forget to also consider conversion options and living benefits such as terminal or critical illness riders. Your agent should tell you about all options and riders.

So should your group plan representative, except that he or she will be doing it for free.