When clergymen Alexander Webster and Robert Wallace of Scotland sat down in 1744 to think of a way to pay monetary compensation to the wives and families of other clergymen in the event of their deaths, the set of events that followed that drive and inquisition set a ball rolling. This birthed the Scottish widow’s insurance company which has provided among other things, life insurance policies for people in the United Kingdom for 206 years.
Before that, the Romans had a crude arrangement that could pass for life insurance. They called it burial clubs. This agreement ensured that friends put together a certain amount to coverage for the funeral arrangements of a dead one and to cater for the families left behind. Like the Scottish widows, there are now many other insurance companies across the world that offer life insurance policies and as of 2019, these companies have combined revenue of $44.7 billion.
Insurance policies are so numerous and commonplace now that every one in two Americans has life insurance policy coverage. More so, workplaces now tend to provide life insurance as part of their benefits packages and pay the premiums partly or even in full.
What is a life insurance policy?
Life insurance policies are contractual agreements between a provider of the insurance policy and the insured, that for an agreed premium fee, the insurer will give a certain amount in monetary value in the event of the policyholder dying.
There are important things to tick off the list if you have a life insurance policy at work. These will help you determine if your policy is best for you or there’s something better you can do.
What to consider in your workplace life insurance policy
- Most of them cover you or don’t cover for your spouse in full.
Life insurance shouldn’t only be about the breadwinner of the family. When the less-earning spouse dies, it also has its own major effects. People will often have to take many days off to morn and bury their spouse and the question to ask yourself is if there is enough to cater for these off days, the expenses and life changes that could come with such deaths – the children may have to change schools, a nanny may need to be hired and paid to take the chaperoning role of the dead parent, etc. It is for these reasons that the insurance of both spouses is important.
- Health decline affecting work could make you lose your insurance coverage.
The idea behind getting insurance in the first place is so that you can have something to fall back on on rainy days. But then, a health challenge preventing you from performing your job could lead to being laid off and with that comes a termination of policy. A person in such a predicament is then left with nothing if the ailment becomes terminal. Considering buying policies outside of work arrangements can provide a safer net for you.
- You could lose your coverage if your job description changes.
Work contracts and agreements are legal documents that, like the lawyers will tell you, have fine lines or details. Sometimes a demotion or change in work arrangements say from full-time to part-time could affect your insurance benefits. Worse still, being sacked from the job or intentionally moving to another can come with the heavy penalty of terminating all benefits accrued including your insurance benefits. Having a policy not directly tied to the office saves you from these as they are usually not dependent on your switching from one job to the other or being laid off.
- Your insurance package may not be worth much.
Unsurprisingly, the primary goal of any company is to make and maximize profit. Doing this could sometimes mean reducing some sections of the pie to expand others. Some experts have opined that people should consider getting insurance packages that promise at least 6 times their annual income. Some have even suggested that getting up to 12 times the annual salary is ideal. But of course, this would depend on your income and how many people actually depend on it.
- Who says there aren’t cheaper options out there?
The policy provided at work may sometimes tick all the good boxes but may be too expensive for you. The good thing about a free market is that you can always sample the pie from different shops. Go hunting for other life insurance policies and you might be surprised to find that there are others offering the same bouquet of services yet at a lower rate. In using these options, you do not only pay less but also protect yourself from the other bottlenecks that may come with work insurance packages. That’s two for the price of one.
Generally, many work-provided life insurance policies do not cover all of these mentioned concerns. It is always best to read between the lines and ask critical questions before you come to a conclusion whether or not such policies are right and enough for you. Otherwise don’t hesitate to hunt for more.
If you’re exploring health insurance or looking for alternative healthcare plans, Life Insurance, or supplemental insurance plans feel free to reach out to our professional agents and see what program or programs might be right for you, that can help you through this time. Call Vivna, Inc. today to learn more here: 866.793.2301