Things to Consider When Buying Life Insurance

If you decide to offer group life insurance to employees, shop around for the best rates and packages through several insurance companies/agents first. You may want to purchase all of your group packages (health, disability, etc.) through one company/agent after you have assessed all your options in order to make it easier to track policies and make payments.

A simple comparison of the premiums is not enough. There are other things to consider.

• Do premiums or benefits vary from year to year?
• How much do the benefits build up in the policy?
• What part of the premiums or benefits is not guaranteed?
• What is the effect of interest on money paid and received at different times on the policy?

Review your group plans regularly as your business grows. Examine how your group life insurance needs and premiums may change as a result of added employees or new capabilities your company offers.

If you're going to provide workers with voluntary group life insurance, check whether the policy you're offering allows them to carry the plan over to a new company should they decide to change jobs. Also see if there are additional stipulations in the policy that can make it more flexible for the employee, such as a waiver of premiums when a worker is on disability leave and may not have the funds to pay for the policy during that time.

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