The coronavirus pandemic continues to disrupt the U.S. economy as businesses both big and small cut back, close and many declare bankruptcy. Consequently, a reported 16.3 million Americans were unemployed in July compared to just over 6 million the previous year, according to the Bureau of Labor Statistics.
In addition to losing their paychecks, many Americans also have lost their workplace benefits like life insurance, which can offer peace of mind in the event of an unexpected death.
If you find yourself without coverage due to unemployment, you may be wondering what your options are. The terms of your current or most recent policy, as well as your health, long-term financial plan and employment status, all play a part in deciding what to do next.
Consider insurance needs
Ask why you want to continue or replace your coverage. In general, life insurance is only necessary if your death would place a financial burden on others.
If you are the high-income earner or sole earner for a young family, assess your situation with us to make sure your family is protected during your unemployment.
Some companies offer to reinstate coverage without evidence of insurability if an employee is rehired within six months. Therefore, ask your human resources department about reactivation options if you anticipate returning to the same company and do not need coverage during your absence. If your spouse has a policy and you are concerned about shared dependents, you may want to consider increasing their coverage to help offset the loss of your policy.
For those who are worried that they may be losing a job, buying coverage now on the open market while still employed may be easier.
Talk to the HR department
Your former employer “likely offers a financial wellness program to help you better understand what benefits you truly need. HR teams can also explain any pandemic-related allowances, such as coverage extensions for employees who are temporarily laid off, furloughed or working reduced hours.
If you are interested in keeping the same policy, talk to your HR team to see if you can convert it to an individual policy. You also may have the option to transfer your coverage to a new employer if it carries the same type of policy.
Consider temporary fixes
Temporary solutions like term life insurance can help bridge the gap between jobs. We can help with policies that are shorter term or a smaller amount of coverage
Evaluate your insurability
When assessing your insurability on the open market, your employment status is only one piece of the pie. Be aware that insurers may also use your driving history or criminal record, as well as your age and health when evaluating your application.
We write a LOT of life insurance here at Benton White Insurance. Our life insurance portfolio consists of 15 companies we can choose from for your special life insurance needs. Please contact us if we can help.
Our business continues as usual and we’re here working and ready to help you! Feel free to TEXT or CALL us at 615.377.1212. You can email us at info@BentonWhite.com.
Stay safe and healthy!
