Things You Probably Don’t Know About Your Life Insurance at Work

For the first time ever, more Americans have employer-provided life insurance (108 million) than have individual life insurance coverage (102 million), according to a new LIMRA study. And while that statistic sounds good, it actually hides a few important facts you should understand.
1. There’s more to the stat than meets the eye. When you dig a little deeper into the study, you find that households that have life insurance coverage through their employer is actually down to 46%, from a peak of 54% in 1984, so the fact is that the percent of employers offering coverage is declining.
2. If you have it, it’s most likely not enough. Most employer-provided life insurance coverage is one to three times your salary. So if you make $50,000, having up to $150,000 of life insurance sounds like a lot, right? But if you try to put that money to work in today’s interest rate environment, you’ll soon find out it doesn’t go very far. And if your family needs to spend $50,000 each year, what are they going to do after the third year?
I would also add that while your salary may be $50,000, what about your other benefits like health insurance? Employers pay an average of $19,000 a year for health care for an employee with a family of four. What if your family had to pay for their health insurance from that $50,000, too?
3. It’s a benefit, not a guarantee. Most Americans believe employers should be required to make life insurance coverage available (73%, according to the same study), but the fact is employers are not obligated to offer it. And remember that just because your employer is offering it now, doesn’t mean they will next year—or at any point in the future. A lot of companies are in cost-cutting mode, and benefits like life insurance can disappear without notice.
4. It doesn’t protect your insurability. Think about what would happen if your health changes while you only have employer-provided health insurance, but then they drop the coverage and you’re no longer able to get life insurance? Or what if you lose your job, or change jobs and the new employer doesn’t offer life insurance as a benefit?
Typically, employer-offered group life insurance is not portable, meaning you can’t take that coverage with you when you leave a job. Some have the option to convert it to permanent life insurance, but what if you can’t afford that option? Buying an individual policy prevents this because it’s something you own.
The bottom line, then, is that it’s good to have employer-provided life insurance, but don’t ignore the larger need you may have for individual life insurance coverage, too.
Use an online calculator like this Life Insurance Needs Calculator to get a working idea of what you need. Then if you need help to figure all this out, reach out to an agent. They can help you get the most coverage for your budget—something that you know will be there in case the worst were to happen. If you don’t have an agent, you can use this Agent Locator to find one near you.

SOURCE: https://www.lifehappens.org/blog/4-things-you-probably-dont-know-about-your-life-insurance-at-work/ 

Fact From Fiction When It Comes to Long-Term Care Insurance

Few people are prepared to handle the financial burden of long-term health care. In fact, many people have a false sense of security when it comes to long-term care. Let’s separate fact from fiction:
“Medicare and my Medicare supplement policy will cover it.”
FACTS: 

• Medicare and “Medigap” insurance was never intended to pay for ongoing, long-term care. Only about 12% of nursing home costs are paid by Medicare, for short-term skilled nursing home care following hospitalization. (Source: Guide to Long-Term Care Insurance, AHIP, 2013)
• Medicare and most health insurance plans, including Medicare supplement policies, do not pay for long-term custodial care. (Source: 2017 Medicare & You, Centers for Medicare & Medicaid Services)

“It won’t happen to me.”
FACTS: 

• Almost 70% of people turning age 65 will need long term care services and supports at some point in their lives. (Source: LongTermCare.gov, November 2016)
• About 67% of nursing home residents and 70% of assisted living residents are women. (Source: Long-Term Care Providers and Services Users in the United States, February 2016, National Center for Health Statistics)

“I can afford it.”
FACTS: 

• As a national average, a year in a nursing home is currently estimated to cost about $92,000. In some areas, it can easily cost well over $110,000! (Source: Genworth 2016 Cost of Care Survey, April 2016)
• The average length of a nursing home stay is 835 days. (Source: Centers for Disease Control and Prevention, Nursing Home Care FastStats, last updated May 2014)
• The national average cost of a one bedroom in an assisted living facility in the U.S. was $43,539 per year in 2016. (Source: Genworth 2016 Cost of Care Survey, April 2016)
• Home health care is less expensive, but it still adds up. In 2016, the national average hourly rate for licensed home health aides was $20. Bringing an aide into your home for 20 hours a week can easily cost over $1,600 each month, or almost $20,000 a year. (Source: Genworth 2016 Cost of Care Survey, April 2016)

“If I can’t afford it, I’ll go on Medicaid.”
FACTS: 

• Medicaid, or welfare assistance, has many “strings” attached and is only available to people who meet federal poverty guidelines.

Whether purchased for yourself, your spouse or for an aging parent, long-term care insurance can help protect assets accumulated over a lifetime from the ravages of long-term care costs.

https://www.lifehappens.org/blog/separating-fact-from-fiction-when-it-comes-to-long-term-care-insurance/

I Have Life Insurance Through My Employer. Why Do I Need Another Policy?

One of the perks of having a full-time job with a good company is the benefits package that comes with it. Often, those benefits include life insurance coverage, which is great. And everyone who can get life insurance at work should definitely take it, as there are many advantages to company-funded life insurance, also known as group life insurance. These advantages include:
1. Easy qualification. Often, enrollment into group life insurance is automatic. That means everyone qualifies, as there is no medical exam required. So people who have preexisting health conditions, like diabetes or previous heart attack, can get life insurance at work, and may get a better rate compared with what an individual life insurance policy might cost them.
2. Lower costs. Employers’ insurance plans tend to be paid for or subsidized by the company, giving you life insurance at a low cost or even free. You may even have the option to buy additional coverage at low rates. Costs tend to be lower for many people because with group plans, the cost per individual goes down as the plan enlarges.
3. Convenience. It’s easy to subscribe to an employer’s life insurance plan without much effort on your part and if a payment is required, it’s easily deducted from your paycheck in much the same way as your medical costs are deducted.
These are all great advantages, but are these the only considerations that matter when it comes to life insurance? The answer, of course, is no.

Life insurance should first and foremost fit the purpose—it should meet your needs.

Life insurance should first and foremost fit the purpose—it should meet your needs. And the primary purpose of life insurance is to care for those left behind in the event of your death. With group life insurance, it’s often set at one or two times your annual salary, or a default amount such as $25,000 or $50,000. While this sounds like a lot of money, just think of how long that would last your loved ones. What would they do once that ran out?
There are several other disadvantages to relying on group insurance alone:
1. If your job situation changes, you’ll lose your coverage. Whether the change results from being laid off, moving from full-time to part-time status or leaving the job, in most cases, an employee can’t retain their policy when they leave their job.
2. Coverage may end when you retire or reach a specific age. Many people tend to lose their insurance coverage when they continue working past a specified age or when they retire. This means losing your insurance when you need it most.
3. Your employer can change or terminate the coverage. And that can be without your consent, since the contract is between your employer and the insurer.
4. Your options are limited. This type of coverage is not tailored to your specific needs. Furthermore, you may not be able to buy as much coverage as you need, leaving you exposed.
Importance of Buying a Separate Life Insurance Policy
It’s for these reasons you should get an individual life insurance policy that you personally own, in addition to any group life insurance you have. Individual life insurance plans offer superior benefits, and regardless of your employer or employment status, they remain in place and can be tailored to meet your needs and circumstances.
Most importantly, an individual life insurance policy will fit the purpose for which you purchase it—to ensure your dependents continue to have the financial means to keep their home and lifestyle in the unfortunate event that you’re no longer there to care for them.
 

SOURCE:https://www.lifehappens.org/blog/i-have-life-insurance-through-my-employer-why-do-i-need-another-policy/

3 Questions to Ask When It Comes to Life Insurance

Your life insurance needs will ebb and flow throughout your lifetime. Buying a term policy early in your career or taking a basic employer-issued life insurance policy is a common course of action.
However, deciding how much and what type of life insurance you need at each stage of your life will serve you and your loved ones much better. 
One simple thing to keep in mind throughout this process is that the more responsibility you have, the more life insurance you need. Here are a few questions to consider:
1. Who depends on me?
Of course, if you have children, a term life insurance policy that is large enough to pay off your home and debts with some money left over to support your family while your spouse or partner grieves and recalibrates the new financial situation is the option that gives everyone peace of mind. 
Many times, it’s easy to overlook the other people who depend on you. The care of elderly parents or grandparents, siblings, or people in your family with special needs should also be considered carefully when deciding how much basic life insurance to buy. You can also get a working idea of how much you might need with this Life Insurance Needs Calculator. 
2. How much insurance can I afford?
A term life insurance policy that covers the care of your loved ones in the event of your untimely death is an inexpensive option, if you are under 40 and in reasonably good health. 
Permanent life insurance insurance is worth researching if you know you have a permanent need for life insurance, such as caring for a special needs child or sibling. It also makes sense if you’d like certain benefits beyond a guaranteed death benefit for your loved ones, like premiums that do not increase with age or changing health conditions, and a cash value that you can borrow against.
If you can afford the additional premium amount and expect your financial situation and income to remain stable long-term, whole life insurance policies offer living benefits that may outweigh the temporary pain of higher premiums. 
3. How healthy am I?
People in great health who have only a little bit of wiggle room in their monthly budget may want to consider a combination of term and permanent life insurance coverage. 
Your clean bill of health will keep premiums for both types of insurance lower than if you have major health issues. If you have a term life insurance policy but want more coverage, adding a permanent policy to the mix may be the ideal answer. 
By adding a permanent policy with a cash-value element to your portfolio, you also open a world of options that could help add to your nest egg in retirement, start a business, or pursue a second career, among other benefits. 
It is possible to have multiple policies and customize your life insurance to your changing wants and needs. Choosing a policy or combination of policies that gives you and your family the greatest potential benefit may seem tricky. So, simplifying the process by asking these three questions will set you on the right track. 
  

SOURCE:https://www.lifehappens.org/blog/3-questions-to-ask-when-it-comes-to-life-insurance/

Life Insurance for a Family of One

We spend a lot of time talking about how couples, families and businesses can protect their financial futures with life insurance. But what about if you are single—do you need life insurance, too?
There are those people who have no children, no one depending on their income, no ongoing financial obligations and sufficient cash to cover their final expenses. But how many of those people do you really know? And, more importantly, are you one of them?
I think it’s important, then, to illustrate how a life insurance purchase can be a smart financial move for someone who is single with no children. Asking yourself these three questions can help you get at the heart of the matter:

• Do you provide financial support for aging parents or siblings?
• Do you have substantial debt you wouldn’t want to pass on to surviving family members if you were to die prematurely?
• Did family members pay for your education?

Don’t Take My Word for It

Life insurance is an excellent way to address these obligations, and in the case of tuition, reimburse family members for their support. But don’t just take my word for it. Instead, “do your own math.” This Life Insurance Needs Calculator can help you quickly understand if there is a need—a need you might not be aware of—that could be easily addressed with life insurance.

The most important reason for you to consider life insurance may be the peace of mind you’ll have.

In addition to addressing any financial obligations you might have, the current economic climate has made permanent life insurance an attractive means to help you build a secure long-term rate of return for safe money assets. The cash value in traditional life insurance can provide you with money for opportunities, emergencies and even retirement.
For young singles, keep in mind that you have youth on your side. I don’t mean to sound trite. Instead, I’d like you to think about the fact that purchasing life insurance is very affordable when you’re young and allows you to protect your insurability for when there is a future need—perhaps, in time, a spouse and children.
While all of these reasons are valid, the most important reason for you to consider life insurance may be the peace of mind you’ll have knowing that your financial obligations will be taken care of should anything happen

SOURCE: https://www.lifehappens.org/blog/life-insurance-for-a-family-of-one/

Juvenile Life Insurance: The Whys and Hows

As a parent, perhaps you’ve been able to check the critical financial boxes for your family. You’ve established emergency funds, secured life and disability insurance, and are on track with your retirement goals. You may wonder, is there anything else I could be doing to help my children?
This can be the time for parents and even grandparents to consider juvenile life insurance. It’s an often-misunderstood type of life insurance that provides protection for your children or grandchildren.
For some, the topic of juvenile life insurance evokes confusion and perhaps even fear. After all, why would one want to insure a perfectly healthy child?
Thankfully, the loss of a child is extremely rare. So while a juvenile life insurance policy does indeed insure against this very slim risk, some types of coverage are also designed to protect your child’s financial future—in a way no other financial product can.

3 types of juvenile life insurance

1) Juvenile permanent life insurance. This type of coverage is permanent, as long as premiums are paid, and typically accumulates cash value over the years, just like with permanent life insurance for adults. Juvenile policies are generally issued at the lowest rates available, and with limited underwriting. They’re owned by a parent or grandparent until the child is 18, at which point the now-adult insured (even if he’s still just a child in his parents’ eyes) can assume ownership.
Upon ownership, the insured adult child enjoys some distinct benefits:
Guaranteed insurability. Your daughter or son locks in a low rate and continued coverage—and can generally purchase more life insurance up to allowable limits. This may be the most compelling reason parents buy juvenile life insurance. Insurability is easy to take for granted when you have it. While most children are healthy, a future health concern could one day make your son or daughter hard to insure. This affects their entire family, who must find other ways to protect against financial vulnerability.
Cash value. The policy’s cash value grows tax-deferred over time, making it a reliable savings vehicle with some unique characteristics. If the cash is needed, the policyowner can access it through low-interest policy loans or outright withdrawals. The policy can also be surrendered for the cash value, typically minus a surrender fee.
2) Juvenile term life insurance. In contrast to juvenile permanent life insurance, juvenile term offers parents significantly less expensive coverage. However, term life insurance does not have a cash value, and only lasts for a specific length of time, such as 10, 20 or 30 years. Policyowners pay a level premium during the length of the term, at which point the term expires and coverage becomes more expensive, often significantly so.
Juvenile term coverage is typically available as a rider (basically, a coverage option) on a parent’s term policy. This rider typically lasts until your child reaches adulthood. You can often purchase coverage for all your children for the same price, with a single rider. In the event of the unexpected death of an insured, the policy’s death benefit can be used to cover expenses.
3) Juvenile group life insurance. Finally, some employers offer juvenile life insurance options through their group life insurance coverage. While convenient, keep in mind employee benefit programs can change at any time, and that in general, group life insurance can be hard or impossible to take with you if you leave your employer.
Remember, while you may have a lot of other priorities on your plate, juvenile life insurance can help create a bedrock of financial stability for your children as they come of age in an uncertain world.;

SOURCE: https://www.lifehappens.org/blog/juvenile-life-insurance-the-whys-and-hows/ 

The Cost of Raising a Child AKA Why You Need Life Insurance

Each year the government (the USDA to be exact) publishes how much it costs to raise a child to 18. The number is staggering. It’s more money than most of us can imagine coming up with, which is why life insurance is so important. You can cover that sum—$233,610—for a modest monthly premium. A healthy 30-year-old, for example, can get $250,000 of term life insurance coverage for 20 years for about $13 a month. That is a small price to pay for both peace of mind, and having your child be OK financially if something were to happen to you.