I have previously blogged about life insurance and accidental death and dismemberment coverage. For those employers who offer a benefit package to their employees, in addition to health insurance and long-term disability insurance, the employee may also have this additional coverage. Often times, the life insurance protection contains a “Basic Life” feature as well as a “Supplemental Life” option. The life insurance benefit amount for an employee is often one or two times their salary. Supplemental life insurance, if selected, allows the employee the option of increasing their life insurance benefit significantly.

Life insurance policies sometimes contain an “Accelerated Benefit” provision which provides individuals who are terminally ill with the option of having the life insurance benefit paid immediately, but for a lesser amount than the total coverage. The accelerated benefit amount may be a flat percentage or could be based upon your age, or even the type of illness. Terminal illness is often defined as a life expectancy of 12 months or less. Life insurance policies also often have a “conversion right” such a provision allows an employee and their dependants if covered to convert the coverage if the person is terminated from employment. This can be a valuable benefit as most conversion provisions provide the right to convert upon termination without having to submit evidence of insurability. For many people, obtaining their own life insurance coverage after termination, especially if they have a medical problem, can prove difficult or expensive. Under a conversion right, the terminated employee has the right to continue coverage, but the individual then becomes responsible for payment of the life insurance premium. To exercise a conversion right, a life insurance policy will require the completion of a notice of conversion right form and that it be submitted within a certain time-frame.

Some life insurance policies even contain a “seat belt and air bag” benefit which may pay an additional benefit if the death occurs while a passenger in a vehicle where the individual was wearing a seatbelt or the vehicle was outfitted with an air bag that inflated upon collision but failed to protect the individual from injury or death.

Please feel free to contact our office if you have any questions regarding your life insurance coverage or if you have filed a life insurance claim for benefits under a life insurance or accidental death and dismemberment policy which have been denied.

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