Make sure you know about options for life insurance to get the
financial protection you need
CHATTANOOGA, Tenn.--(BUSINESS WIRE)--
Here’s a tip about life: It’s OK to ease into it. In fact, we recommend
a phased approach. And pay attention to the details. You’ll discover
some hidden gems there.
This advice is particularly geared to the 95 million adult Americans
without life insurance. And to the millions of American workers who have
some life insurance coverage, but not enough, according to the nonprofit
LIFE Foundation.
As the LIFE Foundation focuses the benefits industry on Life Insurance
Awareness Month in September, Unum (NYSE: UNM) unmasks some secrets to
getting the most out of life.
“Life insurance is one of the building blocks of a solid financial
plan,” says Debbie Cecil, director of life products for Unum. “But it’s
not a one-size-fits-all benefit, and there are a variety of options
available to help individuals make the right decisions at the right time
for their needs.”
Life insurance is frequently offered in employee benefits packages
provided by employers – but this coverage is usually a group policy that
may not allow for continued protection if the employee’s job status
should change.
Access to an individual policy purchased in the workplace may offer
employees the option for “guaranteed issue” at the initial enrollment.
In some instances, the employee may be able to purchase more coverage
later without having to answer additional health questions.
To make the right financial protection choices, it is critical for
employees to understand the different types of life insurance available.
Here’s a breakdown:
- Term life insurance
For young, single workers who don’t
have many financial obligations and for young families who need a lot
of income protection during their working years, term life coverage is
usually adequate and affordable. The policy lasts for a defined period
of time, called the term. A term life policy does not accumulate cash
value. Rates typically go up as the policyholder ages, but are
generally lower than whole or universal life policies.
- Interest-sensitive whole life insurance
Interest-sensitive
whole life offers premiums that will never change, and the policy is
active as long as premiums are paid. These policies accumulate cash
value, and when layered with term life, can provide the protection
needed throughout an individual’s life stages. Interest-sensitive
whole life can offer a reduced, paid-up policy option that requires no
additional premium at age 65 when the individual’s income and income
protection needs decrease.
- Universal life
Universal life premiums are flexible and
can be adjusted to fit an individual’s changing financial lifestyle.
So premium contributions can be adjusted to balance against an
employees’ financial status or needs, which typically reduce at
retirement.
Cecil says that special features of these products can really add value
and are worth a careful look. Unum’s life insurance policies offer more
than just a death benefit. These plans can also include “living
benefits” to help fund a period of long-term care or any other financial
needs for policyholders – and are not limited to those with a terminal
illness.
“The addition of a long-term care benefit rider to Unum’s whole or
universal life plan can give employees and their spouses added
protection without breaking the bank,” Cecil said. “The long-term care
benefit rider is an easy and flexible way to assist with long term care
or expenses.”
To help employees better understand which benefits make the most sense
and when, Unum launched an interactive site, getbenefitsmart.com.
This site offers clear, real-world descriptions of what benefits are
important at different stages of life.
Life Insurance Awareness Month (LIAM) is an industry-wide effort
coordinated each September by the nonprofit LIFE Foundation. The
campaign this year features Buddy
“The Cake Boss” Valastro, the 2012 spokesman for the campaign, whose
father died of cancer when Buddy was just 17, leaving his family with no
breadwinner – and no life insurance.
About Unum
Unum (www.unum.com)
is a leading provider of financial protection benefits through the
workplace. The disability insurance leader in the U.S. for 36 years,
Unum’s portfolio of financial protection products also includes life,
accident and critical illness, which help protect millions of working
people and their families in the event of an illness or injury. In 2011,
Unum paid more than $5 billion in benefits to more than 450,000
individuals and their families.
Unum
Dawn McAbee, 423-294-1892
dmcabee@unum.com
Source: Unum