Life insurance is an undersold product.
These unanswered questions lead to a lack of coverage and potentially disastrous financial consequences for families or individuals who decide to forgo it.
Prudential (see where they rank among top life insurance companies) now offers a life insurance product that tries to make sense of it all and protect us when we need it most…the working years.
The “PruTerm WorkLife 65” program, officially offered by Pruco Life Insurance Company, is designed to provide the necessary life insurance coverage for just that time, while you’re raising a family, and expenses like mortgage payments and education bills stack up.
They argue that this time is when you have the most at stake.
Insurance until age 65 – regardless of when the policy is issued (25 is the minimum enrollment age and 55 is the maximum enrollment age).
No premium increases with age – the rate stays the same as the day the policy is issued, potentially saving you cash over time. (After you turn 65, your insurance premiums are subject to increase annually up to age 85).
Premium payment protection – losing a job or becoming disabled does not kill the deal if certain conditions are met:
• Premiums waived if you become unemployed after the first contract anniversary, but before age 65. Pruco Life will waive one continuous year of premiums max. They require you to remain unemployed for at least 60 days, receive state unemployment benefits and have been continuously employed for a full year preceding the date unemployment began. The unemployment feature may be used only once per policy.
• As far as disablement goes, you must become disabled prior to age 65 and policy premiums will be waived until you recover or turn 65, whichever happens first.
Guaranteed Conversion to Permanent Life – When the policy ends, you do not have to pass a medical exam to convert to a permanent life insurance. Certain conditions apply to this one:
• For guaranteed conversions: Pruco Life will allow conversions to survivorship policies at their own discretion and they reserve the right to discontinue the practice at any time.
• The program’s WorkLife 65 built-in Insured’s Waiver of Premium Benefit Rider for disability and unemployment is not eligible for conversion when you switch over to the permanent life policy.
Basically, PruTerm WorkLife 65 is a term life insurance policy that offers term limits slightly different than what is typically available. Normally, term life comes with a specified term, such as five years, 10, 15 and so on.
With this program, your term simply starts at whatever age you are currently (as long as you’re 25 or above) and ends when you turn 65.
As far as being convertible; there are many policies out there that allow you to convert to a permanent life policy when your term is up…so nothing earth shattering.
Potential insured need to be careful to weigh the balance of a “package deal” that offers ease of use, with the potential downside of locking into a policy that may last as long as 40 years. The deal is only great if the premium you lock into is the best out there. You would certainly want to look at other long term policies to compare pricing.
Some believe if you’re going to commit for that long a period of time, you may opt for a whole life policy, which will certainly cost more, but at least builds cash value over 40 years. This product doesn’t do that for you.
There aren’t really any downsides to the premium protection piece. There are other options on the market that offer that type of insurance, but may be more expensive than buying it in a pre-packaged product.
While this program may be just right for you, it is recommended that you contact a local independent life insurance agent to help you navigate coverage needs and premiums.
It’s always best to shop for insurance quotes with several insurance companies to ensure you receive the best deal…especially when it may be a 40-year, or longer, policy!