A recent report by the Center for Economic Policy and Research showed an alarming trend amongst life insurance holders in the face of the current recession. There has been a steady stream of families that have opted to drop their life insurance coverage to ease their cash flow. As of the date of the report 4.2 million people have already lost their health insurance and life insurance policies. It is estimated that by the time this recession has run its course, the number of people who will lose their health and life insurance policies will at the very least double. Below are a few pointers and things to remember before you fall into the “uninsured” group.
In the current climate being insured with just a group policy isn’t the safest thing. There is a much higher chance of redundancies in the near future and you must be ready for it by getting yourself another independent life insurance quote from an outside provider. If you get sacked then you will also lose your life insurance. When you have lost your life insurance it becomes much harder and often times more expensive than if you were to “change” providers to and independent source before you actually lose your insurance.
There is also something to be said about joint life insurance policies. On the surface of things a joint life insurance program for you and your spouse may seem like a good idea as the price reductions are considerable compared to having just one policy for each person. The problem is that you will only receive a death benefit for one person, not two as with the independent life insurance quotes for each person. Once your spouse dies you are effectively left without life insurance. If you attempt to buy it, you will be charged an exorbitant amount. Get separate life insurance coverage for you and your spouse and not only have one death benefit pay-out.
Another area that people can save on is if they have a critical illness policy that runs concurrently with their life insurance policy. Most people don’t know that they can actually make a saving if they combine both of these policies together with the same insurer. The reason for this is two fold. Firstly, critical illness policies and life insurance policies are related and as such have some overlapping coverage which is not efficient for the client. If you have both insurance policies running then it makes sense for you to talk to your insurance provider and see if they can get a quote for both life insurance and critical cover combined under the same product to save you some money. The second reason is that you get a bulk discount from many insurers too by having more insurance products with them.
We also have to address the problem of people stopping their premium payments just so save on a few hundred dollars a quarter. In the face of it, it may seem that saving that few hundred dollars will actually help you survive the recession; however we feel that this is unfounded. You should be cutting back on consumer expenses like renting fewer movies, going out less, changing eating or drinking habits to save money. It is never a wise thing to skimp on insurance, especially one that has the wellbeing of you family at stake. At the very least, it is irresponsible to take away the future death benefit that you family will see when you pass on. It is the time when they need the most money.
We think that the importance of life insurance cannot be understated even in these recessionary. The worrying trend is that many seem to think they can set aside their life insurance responsibilities for this recessionary period. This is wrong; one of the last expenses that you should fore go is your life insurance premiums.
Leave a comment