Benefits Blast

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ISSUE 4

This month's issue is about CONVERTING YOUR GROUP LIFE INSURANCE

This month we would like to remind everyone that if your company provides GROUP LIFE INSURANCE, then you should be providing a Life Insurance Conversion Form to every employee when their coverage terminates.

Upon termination of Group Life Insurance, most plans provide a 31-day period for the employee to convert to an individual life insurance policy. The most common reason for life insurance to end is termination of employment, however, life insurance can also terminate due to a time limit as defined by the policy while an employee is on a leave of absence, or as a result of a reduction of the insurance amount due to reaching a limiting age. in addition if your group life policy covers dependents, the dependent's life insurance may end due to loss of eligibility.

While life insurance conversion policy rates are high, the conversion policy may be the individual's ONLY SOURCE of life insurance due to their health. Most carriers require that the individual apply and pay premiums within 31 days of the date the life insurance coverage termianted, thus, the importance of the Conversion notice being provided to the employee IMMEDIATELY upon termination of life coverage. Check your policy's wording as to the date coverage terminates as most life insurance plans terminate on the last day worked, and not the end of the month. Once the conversion form has been provided to the employee (you should maintain a record of having provided the form), the responsibility is now on the employee to pursue the actual conversion.

Call us if you have any questions!

Don't forget! It's Life Insurance! It's important!

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