I just off off the phone with a man who got laid off and then got blown over when he found out the reality of what it would take to make his group life insurance portable.
Since I’ve been in the business, even back when I was big into setting up group plans, I always recommended that people carry some life insurance outside the workplace. Group life insurance is great stuff. Don’t get me wrong. As long as you are employed and your benefits don’t get changed group life is one of those rare gems that is a real blessing. Real live cheap life insurance. Sometimes even free!!!
And then the benefits get or the lay off comes and the reality comes. You are offered the opportunity to convert your group policy and you’re thinking “all is not lost”. Then you find out what the opposite of cheap group term insurance is. The only option they offer on the conversion in almost every case will be an expensive whole life or universal life policy, and I am talking gag reflex expensive.
So, you’re laid off and your income has just been slashed to the bone if there’s any left at all and the cost of your family protection has just been quadrupled or worse, much worse. The only good news in this scenario is if you happen to be in good health. You should be able to get an individual term life policy for a very reasonable price. If your health is not so good, something that is absorbed by group life insurance, you should be seeking out an independent agent to shop for the best possible price you can find and put in force what you can afford.
Bottom line. If you still have your job and you still have a group life insurance policy, count that as frosting and go out and purchase an individual policy. Get something that no board of directors, no employer and no recession can take away from you.