While many Americans seek and obtain benefits through outside sources, the vast majority purchase their benefits through their employer. This goes beyond health insurance, often including short-term disability and protective options like life insurance. If you purchase supplemental benefits through your employer, those benefits are only available to you for the term of your employment. In this article we focus on life insurance.
So what happens to your life insurance policy if you leave your job?
Your Employer Stops Paying Their Portion Of Your Premium
Part of the benefit of employer-sponsored coverage is that they financially cover a portion of the cost of your plan. This makes coverage significantly cheaper. When your employment is terminated, they immediately stop making payments. This is because your policy comes as part of a group plan and you are no longer part of it once you leave. Whether or not you can continue to hold your policy depends on a number of factors.
Determine Your Options
Not all life insurance policies were created equally. Whether you can continue your coverage after your employment ends depends on the type of policy you’ve purchased. Every employer-sponsored plan is different, but typically speaking, you only have two options to continue your coverage and if one of these does not apply to your policy, your life insurance policy ends when you leave your job.
Port Your Policy Over
If your old employer and your new employer hold their life insurance group plans through the same carrier, you may be able to port your policy from the old employer to the new one.
Convert Your Policy
If the carrier doesn’t remain the same between your two jobs you may be able to convert your group plan into an individual policy. Whether you can or can’t is up to your policy terms and your carrier. If you convert, you’ll be required to pay for the entire cost of your premium, which might not fit your budget.
Who Can Assist Me With My Policy?
In order to verify your policy terms to discover your options, you’ll want to do one of two things, either contact your carrier or talk to your human resources representative. They’ll be prepared with information to assist you in making the switch and be able to guide you through the next steps.
If My Policy Gets Cancelled, What Can I Do?
If you are unable to port over your policy or convert it, you still have options to ensure you remain protected. One option is to determine if your new employer offers a life insurance policy as part of your employer-sponsored benefits package. If they do, you’ll be able to continue coverage after the required waiting period. If your new employer does not offer life insurance, you can purchase life insurance directly from the carrier or through a broker.
Let Insuraway Find An Life Insurance Policy Tailored To You
At Insuraway we offer two types of life insurance coverage, Whole, and Term. We offer a variety of policies through dozens of A-rated carriers. All it takes is one call to discover your options for protecting your loved ones. Call us at 1-800-763-4167 to get started today.
