SafeAmerica Credit Union

Life Insurance

• By Kevin Alvarez

Life Insurance Awareness Month

September is Life Insurance Awareness Month and if we've learned anything from these past few years, it's that life is unpredictable. At SafeAmerica Credit Union, our hope is to bring awareness and encourage you to learn more about Life Insurance and why it's so important to have.

A Member Benefit for You!

We strive to offer our members the best access to many products and services, such as Life Insurance.  We’ve partnered with TruStage to provide you with easy and affordable access to Auto, Home and Life insurance.

As a member of SafeAmerica Credit Union, Trustage® will work with you to select a policy that's right for your budget, with ongoing support and no hassle.

Trustage Life Insurance® can help give you peace of mind today and provide an income-tax free cash benefit for your family. It can help pay expenses you might leave behind such as funeral costs, mortgage payments or unpaid debts. Trustage helps make it easy to compare insurance and explore options you can afford—so you can make a good decision today for your family.

Types of Life Insurance

Life insurance can be confusing.  Here is a brief summary of the types of insurance you can consider.

Term Life Insurance

Term Life Insurance will cover you for the length of your policy. As long as your premiums are paid, you will be covered. Learn more here.

Whole Life Insurance

With Whole Life Insurance, the rate you initially pay would be locked-in for the entire duration of your policy. Even if health conditions change and your premiums are paid, your coverage will never be cancelled. Learn more about Whole Life Insurance here.

Guaranteed Acceptance Whole Life Insurance

Guaranteed Acceptance Whole Life is a policy which does not turn down people for their health. As long as premiums are made, coverage will never decrease or be cancelled. Learn more about Guaranteed Acceptance Whole Life Insurance here.

Learn More

You can also learn more about Life Insurance by visiting the Trustage website. They offer a variety of quick-read articles to help you make an informed decision.

Read about: Understanding Insurance

Understanding Insurance

Get Started Today

Trustage® can help you get coverage that fits your needs and budget. We designed it to be easy to:

Don't wait, get an instant online quote today. Or call 1-800-814-2914 and talk to a licensed agent.

Why Trustage®

Since 1935 Trustage has been assisting millions of people by helping protect the financial future of their loved ones with insurance policies designed to be affordable.

Trustage works with thousands of credit unions across the United States helping families prepare for the future and help secure the financial stability of millions of credit union members.

Learn More

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TruStage® is underwritten by CMFG Life Insurance Company, a well-known credit union member insurance provider. For more than 80 years, CMFG Life has earned the trust of members nationwide and is rated “A” (Excellent) by A.M. Best, an independent national organization that rates insurers’ financial strength and performance. “A” is the third-highest of 16 ratings, as of March 2021. Join more than 20 million members who rely on TruStage.

TruStage® Life Insurance is offered by TruStage Insurance Agency, LLC and issued by CMFG Life Insurance Company, P.O. Box 61, Waverly IA 50677-0061. The insurance offered is not a deposit and is not federally insured or guaranteed by your credit union. Products and features may vary by state.

© TruStage Insurance Agency

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• By Kevin Alvarez

Is My Employer’s Life Insurance Enough?

If you’re like a lot of people in the workforce, you might have signed up for your company’s life insurance program as soon as it became available. Registration was simple, and the insurance most likely costs you little or no money. Choosing to join might have been an easy decision.

But is basic life insurance through an employer enough to meet your needs? According to a survey, 29%1 of workers believe that it is. But you might be shocked to discover that it may not be.

How Does “Work Life Insurance” Work?

Employer-provided life insurance is a type of group life insurance because the plan covers everyone who chooses to participate at your company. Employers enter into a contract with a central insurance agency to provide life insurance coverage conveniently to all their employees.

Employer-paid life insurance often means that your company will pay the entire monthly bill for your insurance. But this isn’t always the case. In some instances, your employer will pay most of the cost, but you’ll still have to pay a small amount that’s typically deducted from your paycheck.

Why Do Employers Offer Life Insurance?

Group life insurance makes an excellent addition to an employee benefits package. Companies that offer free life insurance often have a hiring advantage over a business without a group plan.

One reason for the benefit’s popularity is that even workers with serious health issues usually find it easy to get insurance through group coverage. Everyone at the company automatically qualifies because the insurance company doesn’t mind accepting the risk of insuring a person with health challenges as long as most of the other insured coworkers are healthy.

How Much Does An Employer Provide?

The median coverage for a company employee is $20,000 or one year’s salary.1 Some companies may offer you a plan that pays two or three times your salary.

If you need more insurance, employers may give you the chance to purchase an additional amount of insurance through the company’s group plan. Even then, however, there are still a few points to consider before deciding whether employer-provided insurance meets all your coverage needs.

Does My Employer’s Life Insurance Meet My Needs?

Is the amount of coverage your employer offers enough for your family? Will they be able to get by on $20,000 or on the equivalent of one or two years of your salary?

One consideration may be whether you want enough insurance to help pay off your debts and provide for your children’s education. In addition, there may be other reasons why you need a larger insurance payout than what your employer’s insurance offers. For example, you may have an aging parent who relies on your income. In that case, you may want to factor in the cost of providing quality nursing care for that person after you’re gone. If you have questions about your needs, speak to a licensed agent.

Even if you are able to apply for more coverage through your employer-provide coverage, you may have to answer medical questions or get a physical. In that case, some medical conditions could prevent you from adding to your policy. Or you might be asked to pay more than you can afford.

Does My Employer-paid Life Insurance Carry Over From Job to Job?

Maybe the biggest drawback of relying entirely on life insurance from your employer is that, in most cases, the insurance provided by your company covers you only as long as you remain at the company. Typically, the insurance coverage stops when you leave, whether it’s because you resigned or because you were laid off or fired. If you see yourself leaving your job at some point in the future, you will need to think about how to replace the coverage you had. If you’re lucky, your new employer might also offer life coverage. But there’s no guarantee it will.

One Option: Convert Employer Insurance To Personal

One way around the problem of losing your life coverage when you leave your job is to convert your employer-provided life insurance to personal life insurance, if your company gives you that option. Usually, no medical exam is required when a person makes the change. But once your coverage goes from group to personal, you, rather than your employer, will be responsible for making your full monthly payments. And at that point you might be able to get a better deal on both the cost and the amount of coverage if you just leave the employer policy behind and shop around for a new insurance policy.

Should You Get Life Insurance Outside of Work?

The insurance provided by your employer is a great benefit. But it may not be enough. So, carefully calculate how much insurance your family needs and, if you need more coverage, consider purchasing a separate personal policy in addition to the group policy you have through your workplace.

SafeAmerica Can Help

Trustage Life Insurance

Life insurance can be a simple, affordable way to help protect your family if you pass away. It can provide your loved ones with money to help pay for things like mortgage or rent payments, day to day bills or medical and funeral bills. SafeAmerica has partnered with Trustage to provide you with affordable, member-only pricing on life insurance and more.

For more information and to get an instant online quote, click below. 

SafeAmerica: Home, Auto and Life Insurance

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We encourage you to read and evaluate the privacy and security policies on the site you are entering, which may be different than those of the bank.

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1 2021 LIMRA’s Life Insurance Barometer, “Top Misconceptions About Life Insurance”. 

• By Kevin Alvarez

September is Life Insurance Awareness Month!

September serves as Life Insurance Awareness Month. We all want what is best for our families and life insurance provides our loved ones with peace of mind as well as security from any end-of-life and final expenses. Before we begin to learn about what exactly life insurance is and how beneficial it is for our family, let's understand some terminology used in life insurance policies.

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Life Insurance Terms

Administrator: The person (usually the spouse, domestic partner, or close relative) that the court appoints to manage the estate of person who dies with a Will. The administrator is also called the personal representative of the estate.

Beneficiary: The beneficiary of a life insurance policy is the person, organization or trust that you define as receiving the life insurance payout. If you take out a $10,000 policy and name your child the sole beneficiary, when you die, they get $10,000. You can also assign multiple beneficiaries to your policy and define just how much of the policy they’ll receive. For example: John takes out a $25,000 life insurance policy. He names his wife and his two sons as the beneficiaries of his policy, but he specifies that his wife will receive 50% of the payout and each of his sons will receive 25% of the payout. John dies, and his wife gets $12,500, while each son gets $6,250.

Cash Value: For most whole life insurance policies, when you pay your premiums some of that money goes into an investment account. The money in this account is the cash value of that. If you cancel a policy, you can receive the cash value of the policy as payment instead of the face value.

Death Benefit: A death benefit is the money paid upon the death of the insured. It’s usually a payout of the full coverage amount defined in the policy (a $10,000 policy pays a $10,000 death benefit).

Decedent: The person who has passed.

Estate:  All liabilities as well as assets like your home become your "Estate". You would have to take inventory of all things you own and decide how your heirs and creditors would receive assets.

Executor: A person named in a Will and appointed by the court to carry out the dead person's wishes. The executer is also called the personal representative of the estate.

Face Value: The face value of the policy is simply the coverage amount the policy is worth. So, the face value of a $10,000 policy is $10,000. This is usually the same amount as the death benefit.

Living Trust:  A trust set up during the life of a person to distribute money or property to another person or organization.

Personal Representative: The administrator or executor that the court appoints to manage the estate.

Probate: The court process for distributing a dead person's assets, paying debts owed and settling the financial affairs of people when they pass.

Successor: Anyone who has the legal right to receive property of a person who dies, either under the Will or the Probate Code.

Trust: An agreement where property is given to someone to be held for the benefit of another person.

Will: A legal document with Instructions about what will happen to their property after death.

"Do I really need life insurance?"

"If you were to die, would your family struggle to pay for

your funeral, mortgage or daily living expenses?"

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What End of Life Expenses to Expect

A study done by Experian in 2016 determined 73% of Americans are going to die in debt. Unless a family member cosigned with the person who passed, debt is typically not inherited by any of the surviving family members and is paid off by the estate.

What may come out of pocket for the living family members (with no insurance policies in place) may be the following:

  • Funeral Expenses - The California average is about $11,777.  
  • Nursing Home Care/Hospice Care - This can easily reach $1,000 for 24 hour care, BUT Medicaid may be able to cover 100%. 
  • Medical Bills - Depending on medical conditions and treatment, this cost only adds stress to an already difficult time.

"How much life insurance do I really need?"

"The amount of insurance depends on the standard

of living you wish to assure your dependents."

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The Two Basic Types of Life Insurance:

What is Term Life Insurance?
  • Available terms can range from 10 to 30 years 
  • Beneficiaries receive larger death payouts than whole life insurance policies
  • Benefits transfer to beneficiaries tax-free
  • Can easily be converted to Whole Life Insurance
  • Lower payments based on how young you are
  • May be a challenge to renew your policy upon expiration
  • No ability to cash out for end of life expenses
  • Protects your family from a loss of income
  • Temporary policy with an expiration date 
  • Typically costs less than Whole Life Insurance
What is Whole Life Insurance?
  • Burial costs and other final expenses are covered
  • Builds cash value, which could be used while you are alive
  • Coverage will continue as long as payments are made
  • Death Benefits transfer to beneficiaries tax-free
  • Death benefit amount can never decrease
  • The cost (Premiums) do not increase as long as payments are made
  • Smaller death payout
  • Typically higher in cost than Term Life Insurance

"I'm pretty healthy, I'll wait until I am older to get Life Insurance."

"You pay less if you get insurance when you are younger and besides

you'll be covered should any unexpected health issues arise."

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Think of Life Insurance as a Form of Investment

Just as some invest into the stock market and/or the real estate market, whole life policies build cash value through a portion of the money used for premiums through interest. Over time, this sum slowly grows to the point where you can borrow from it tax-free. Keep in mind, you will have to pay interest on this loan and any remaining balance will be deducted from the death benefit your loved ones are set to receive.

If the above-mentioned funds become big enough, you may have the option to trade the policy for an annuity. This would provide you with monthly payments for the rest of your life or when the funds are exhausted. While this may sound like a great idea, you would have to keep in mind, there is a chance your insurance policy will not pay out the death benefit to your loved ones.

Another option available with Whole Life Insurance is being able to surrender (sometimes known as "selling") your policy to the insurance company. By doing so, you void your insurance coverage and while you will get a sum of money, it would not be as much as the amount the insurance company would have paid out when you pass. While thinking of life insurance as an investment, understand this should not replace your savings or 401k.

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How To Pick the Right Policy

Which policy best aligns for your own goals and/or family's goals? When it comes down to figuring out which policy is best, most will initially pay for term life insurance until their career reaches an established point in-which more of their earned money is used towards converting their term policy to whole life.

SafeAmerica Credit Union has partnered with Trustage® Life Insurance to help credit union members like you protect the people who matter most in their lives. Any amount of coverage can make a difference.

TruStage® Life Insurance can help give you peace of mind today and provide an income-tax free cash benefit for your family. It can help pay expenses you might leave behind like funeral costs, mortgage payments or unpaid debts. TruStage helps make it easy to compare insurance and explore options you can afford—so you can make a good decision today for your family:

Get an Instant Quote
Understanding Insurance

TruStage® Life Insurance is offered by TruStage Insurance Agency, LLC and issued by CMFG Life Insurance Company, PO Box 61, Waverly IA 50677‑0061. The insurance offered is not a deposit and is not federally insured or guaranteed by your credit union.

© 2020 TruStage Insurance Agency

DTCG-2947101.1

Sources:

https://www.courts.ca.gov

https://www.debt.org

https://educationdata.org

https://www.forbes.com

http://www.insurance.ca.gov

https://www.investopedia.com

https://www.investopedia.com

https://www.trustage.com

https://yahoo.com