Supplemental Life Insurance
Are you wondering "What is supplemental life insurance?" If so you will find some answers here.
Supplemental life insurance can fill the gaps left in many group plans people get at work through their employers. Supplemental life provides important answers to these questions:
- Does my group plan provide a big enough death benefit?
- What if I leave my employer?
- What if my spouse dies before me?
- Do I have a college saving plan in place?
The Right Death Benefit
Supplemental life insurance allows you to increase your death benefit amount, and make sure that your family is adequately covered.
Many group life programs provide a death benefit expressed as a multiple of salary, or a fixed death benefit amount. While the coverage is often very affordable, the death benefit amount may not be enough for many employees. Employers may pick a common death benefit amount. But since employee needs vary, it may not be the right amount for everyone.
Portable Coverage
The weakness with group life insurance programs is their lack of portability. Your life is protected only as long as you work for your employer. Do you plan on retiring with your current employer? Do you think you will make it to retirement before being laid off?
Let's face it. Long tenures with one employer are a thing of the past. What happens if you get sick, then lose your job? You lose your group life coverage, and you may not qualify for life insurance.
Supplemental life coverage allows you to get a portable policy that you keep when you separate from your employer. Lock in low rates when you are young, and before health events prevent you from getting coverage.
Spouse Coverage
Most group life insurance programs protect the lives of the employee. With two income households being the norm, you may not have adequate coverage for your spouse. If your non-working spouse were to die, who would take care of things at home?
Supplemental life provides coverage for your spouse. You can elect a single policy, or add your spouse coverage as a rider to your policy.
Cash Value College Funding
Many parents wait until very late in the game to begin a college savings plan. And those that do sometimes find their fund values plummet just as their child reaches college age.
Supplemental life insurance provides cash value accumulation, which helps fund college savings in three ways:
- Life insurance protection that provides funds for college expenses should you or your spouse die prematurely.
- Cash accumluation inside the policy. Use policy loan feature to access the cash value, or cash out the policy to pay for college expenses.
- Guaranteed tax free accumulation. No need to worry about the volatility of the stock market.
