Like many people, you may be unfamiliar with voluntary life insurance policies, so we’re providing you with some information in this miniature guide.
The purpose of all types of life insurance is to provide financial security when someone is no longer here. The death of a loved one or even yourself is not a comfortable thought to have. However, it is always better to be prepared than not to be. Purchasing voluntary life insurance through your employer is one way to be ready in the unfortunate event that you may need to use it. Like many people, you may be unfamiliar with voluntary life insurance policies, so we’re providing you with some information in this miniature guide.
What is Voluntary Life Insurance?
Employers offer voluntary life insurance as an optional benefit in addition to an already existing life insurance plan. Typically, when you start a new job is when you will have the option to purchase voluntary life insurance. If you are unable to buy the policy then, you will usually be able to do so shortly after you are hired or during your employer’s open enrollment period.
Cost and Amount
It is typically equal to a year’s salary and provided with employer-based plans, sometimes at no additional cost. For example, if your yearly salary is 50k, your policy would also be worth 50k.
Your voluntary life insurance benefits are deducted from each of your paychecks as regular premiums The higher your payout, the higher your premium, and the more money will be deducted from each paycheck.
In the unfortunate circumstance that you die while covered under insurance, the insurer will pay a death benefit to those listed under the policy as beneficiaries.
Other Benefits of Voluntary Life Insurance
A voluntary life insurance policy typically offers the same benefits as life insurance but at a lower cost than a private policy. You could use it to cover costs such as your children’s education, daily expenses, funding a spouse’s retirement, and even payments toward a home mortgage.
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