COLUMBUS — Lieutenant Governor Mary Taylor announced that the month of September is designated as ‘Life Insurance Awareness Month’ through a resolution signed by Ohio Governor John Kasich, to educate Ohioans about the importance of life insurance.
“Promoting Life Insurance Awareness Month is yet another way the Ohio Department of Insurance is taking steps to encourage more Ohioans to seek information and secure the lifetime protection their families need,” said Taylor, also director of the Ohio Department of Insurance.
Life insurance proceeds can help pay immediate expenses including uncovered medical costs, funeral expenses, final estate settlement costs, taxes and other lump-sum obligations such as outstanding debts and mortgage balances. They can also help families cover future financial obligations like everyday living expenses, money for college tuition, a spouse’s retirement and more.
According to research conducted for the National Association of Insurance Commissioners (NAIC), less than half of young families have life insurance. Because planning for life’s uncertainties will help secure a financial future for those you love, Taylor suggests you review your insurance needs to help ensure you have the right policy for your financial situation and your family composition.
Important life insurance life-stage considerations:
Young Singles: While buying a policy early in your life will provide lower costs and potentially guarantee your insurability, some believe the need for life insurance at a young age typically without dependents may not be necessary. You should consider your options and make a choice based on your finances, health and other circumstances.
Young Families: Having children is often the catalyst for buying life insurance. When securing coverage, consider covering both spouses – even if one stays at home and is not employed. In the event of the stay-at-home parent’s death, the surviving spouse will need to shoulder all the responsibilities of the household.
Established Families: Remember to periodically review and update your coverage to reflect changes in your financial situation and family composition. One strategy to keep costs down for a growing family might be to take a look at term life insurance, which offers financial protection for a specified time period.
Seniors: Now is a good time to re-evaluate your life insurance to determine whether you still need as much coverage when you had a younger family and larger mortgage principle. If you are covered through your job and are planning to retire soon, inquire about converting it to an individual policy.
Single Parents: If you and your ex-spouse have life insurance policies, adjust the beneficiaries to reflect the changes you both want after the divorce is final. Review your policy, will and retirement accounts to make sure they all indicate the correct beneficiaries. If your spouse will be paying for child support, consider requiring that he/she purchase a policy covering the term of the payment and be named as the policy owner and beneficiary.
Military: Check your policy renewal date and payment terms with your agent to ensure your coverage will remain in effect during deployment. If necessary, you may be able to renew a policy early or have your premiums paid by automated bank draft. Some insurance companies might also allow you to suspend certain coverage while you are deployed.
Raising Grandchildren: It is generally not a good idea to leave a life insurance benefit directly to a minor child. Make sure the policy names a contingent beneficiary or a trustee who will act as a beneficiary on behalf of the child. Otherwise, the life insurance benefit may not be accessible to the child until the issue is processed through court. You may want to set up a family trust with your selected trustee in charge.
Ohioans with questions about life insurance can call the department’s consumer hotline at 1-800-686-1526. A life insurance consumer guide and a listing of licensed agents are also available at www.insurance.ohio.gov. You can follow the Ohio Department of Insurance on twitter @OHInsurance and on Facebook at www.facebook.com/OhioDepartmentofInsurance.