Well, a life insurance lesson.
I've recently been working on an outreach program to our agency's clients to remind them that we also do life insurance, and to educate them on why that's important. One of the most common responses has been that "I already have life insurance at work." What they mean, of course, is that their employer provides them coverage while they are employed there (although some may, in fact, also have coverage like AFLAC which they do own). That employer-provided plan is called 'group term life' and it almost always terminates when one's employment does.
But Henry, I've worked at XYZ Widgets for years, plan to retire from there, so why should I worry?
Well, friend, here's why (and Thanks to co-blogger Bob for the heads' up):
Is this right? Maybe, maybe not, but it's real, and I bet the folks that also bought their own coverage are sleeping a little easier right now.
More to the story?
Bob also sent along this update from a colleague:
"Yes we have an Alcoa plant near us. I had the first walk in with one of those policies in the cancellation paperwork and a check in his hand yesterday.
They can send the check back to Alcoa and fill out a form and have life insurance continue. But the only problem is they don’t tell them how much coverage to have or if they have to make any premium payments in addition to the check. When we called the phone number it was with the letter they acted like we didn’t need to know all the information they could just cash the check and put it in the bank or they could send it in and have some life insurance.
The man I was helping was almost 90 years old and not in great health so I feel very certain the G.I. option on the life insurance is what he needs to go with. But you can’t make decisions like that without knowing how much that check is going to buy.
That check was for $6000. If that gets him $10,000 of paid up coverage then it’s a no-brainer. But if it gets him $7500 of coverage plus he still needs to continue his monthly payment then I probably wouldn’t do it. It was way beyond the scope of what they could help us with getting that information. They said they can have an insurance agent calling within five business days. The man is 90 years old and he was overwhelmed with it and very frustrated. They should have people on those phone lines that can give you the basic information you need or better yet put it in the letter that you sent out to the retirees along with the check."
This is unconscionable. So I reached out to Alcoa, and their Director of Communications, Jim Beck, offered this reply:
"While any action that affects our retirees is difficult, this decision is in alignment with our strategy to improve Alcoa for the long term, including through balance sheet improvements. As a voluntary action, however, we are offering affected retirees cash payments that can be used for any purpose, including finding alternative insurance. If a retiree does not cash the check, that will not change the planned termination of coverage on December 31, 2019. We took similar action with other retirees in 2018.”
Make of that what you will.
More to the story?
Bob also sent along this update from a colleague:
"Yes we have an Alcoa plant near us. I had the first walk in with one of those policies in the cancellation paperwork and a check in his hand yesterday.
They can send the check back to Alcoa and fill out a form and have life insurance continue. But the only problem is they don’t tell them how much coverage to have or if they have to make any premium payments in addition to the check. When we called the phone number it was with the letter they acted like we didn’t need to know all the information they could just cash the check and put it in the bank or they could send it in and have some life insurance.
The man I was helping was almost 90 years old and not in great health so I feel very certain the G.I. option on the life insurance is what he needs to go with. But you can’t make decisions like that without knowing how much that check is going to buy.
That check was for $6000. If that gets him $10,000 of paid up coverage then it’s a no-brainer. But if it gets him $7500 of coverage plus he still needs to continue his monthly payment then I probably wouldn’t do it. It was way beyond the scope of what they could help us with getting that information. They said they can have an insurance agent calling within five business days. The man is 90 years old and he was overwhelmed with it and very frustrated. They should have people on those phone lines that can give you the basic information you need or better yet put it in the letter that you sent out to the retirees along with the check."
This is unconscionable. So I reached out to Alcoa, and their Director of Communications, Jim Beck, offered this reply:
"While any action that affects our retirees is difficult, this decision is in alignment with our strategy to improve Alcoa for the long term, including through balance sheet improvements. As a voluntary action, however, we are offering affected retirees cash payments that can be used for any purpose, including finding alternative insurance. If a retiree does not cash the check, that will not change the planned termination of coverage on December 31, 2019. We took similar action with other retirees in 2018.”
Make of that what you will.
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