How secure is your life insurance? Given how important it is to an individual’s financial plan, it seems like something that would be guaranteed. But that is not always the case.
Do you remember when retail giant Sears announced that it would end life insurance benefits for almost 100,000 of its retirees, all of whom had expected that coverage to be maintained? The company sent notifications to people in their 80s who had maintained life insurance coverage for a significant period of time and relied on it. Given their age, those retirees who were affected had limited options. Some had to pay several thousand dollars a year to maintain their coverage with another insurance company.
That, of course, is a rare event, but it can happen, and no one wants to end up without life insurance. Thus, regardless of how you obtain your life insurance, you may want to explore how secure it is. You can research a life insurance company’s financial strength through independent rating firms, including AM Best, Fitch, Moody’s or Standard & Poor’s. Ratings can generally be viewed for free on the firms’ websites, although you might have to register first. Each of these firms has its own rating system, so it may not be easy to compare apples to apples.
It is critical to choose a financially strong life insurance company because you want the company to be around to pay the death benefit to your beneficiary, whether you die in five years or 50.
These are guidelines, of course. A single article can’t replace the knowledge of your individual financial circumstances that a personal financial planner possesses.
Let us help you navigate what’s best for you. Please call or email us if you want to better understand your life insurance stability and options.