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What Happens to Life Insurance When You Leave a Job?

Published by Robert J Stillwell on January 25, 2024

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This can be a common question as people navigate their careers, especially if that individual started with one company for so many years and is now making a move for the first time in their career. Sometimes people aren’t educated in this field and depending on the carrier that your company uses for insurance coverage, you may not have had it explained properly. This is why it’s always best to do your own research and educate yourself on something like this as much as possible. Life insurance is something that will affect your loved ones, so you need to take the time to consider that and factor in the extra consideration to know they’ll be okay when you’re gone.

Identify Your Life Insurance Provider

When you turn in your letter of resignation, you should ask your employer’s human resource department if they know what’s going to happen or who you should get in contact with. This first move can answer all of your questions, if your company has a good human resource department. Unfortunately, you may find it’s a common occurrence that your human resource department or benefits representative may not be helpful in this situation. You should ask them who provides your life insurance and the contact information for the company’s representative. If they still aren’t able to provide a representative’s contact information, get the name of the company that provides the life insurance and reach out to them. Lucky for you, insurance companies have easy to use websites and apps that are able to get the information you need.

Identify Your Type of Life Insurance Policy

After you identify who your life insurance provider is, your next step should be to find out what type of policy you have. From there you may be able to cancel the policy, port the policy into another group plan (if your new company has a policy with the same company), or convert your group plan to an individual plan. Figuring this out, will ultimately decide what your next move should be. If your new company doesn’t have the same policy as your past employer, your coverage will either end or you will be given the option to convert your policy to an individual plan based on your current height, weight, health, age, and tobacco usage status.

What Can You Do With Your Life Insurance Policy?

In some cases you may be forced to cancel the policy with your current provider. What do you have to do in that situation? Is there anything in particular that you need to be aware of? Simple answer is no, typically you can just let the policy lapse and you won’t have any issue. This should be something that you confirm with your benefits representative. If you are joining a company with the same provider of life insurance as your old company, you will be allowed to “port” your policy. Porting your policy means that you’re taking your policy from the old company’s group and moving it into the group with your new company. Before you port your policy into the new company, you may want to look around and see if you can find a better option from a provider outside of your company. 

If your life insurance ends and you’re in the market for a new one, you should shop around. Maybe your company’s plan isn’t the best option for you. You should contact Robert J Stillwell and see if any of our options can compare. While our policies require you to pay out of pocket, the rate may be better than what you would pay into your company’s plan. Another benefit of finding your own life insurance policy with a company like the Robert J Stillwell Agency, is that you won’t have to worry about this happening

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