2.5 minute read
Dave is a recent college graduate and just started his teaching career. He makes sure to sign up for his employer’s insurance coverage. Fast forward three years, Dave marries Shelia and adds her to his policy. A year later, baby Glen arrives and is added to Dave’s coverage. Next come the twins Ellie and Owen who get included too.
Throughout your life, you experience many life events. These may include getting married, having a baby, adoption, divorce, death, etc. Depending upon your employer’s insurance offerings, you may have the option to enroll your spouse and/or dependent children into your medical, life, dental, and vision insurance plans. So, when these life events happen, it’s important for the employee to reach out to their HR or Benefits Department to make sure that the proper benefit changes (additions or deletions) are made.
Check out these examples of common situations where an employee may forget to make an update:
Baby Glen is all grown up and is now age 26. Dave’s insurance coverage covers only dependents up to age 26. After Glen’s 26th birthday, he will no longer be covered. Dave should make sure to contact his HR or Benefits Department and let them know that Glen has aged out of the coverage. Many insurance carriers don’t keep track of dependents’ birthdates, so sometimes employees/employers find out that they are still paying for coverage that they don’t have.
If Glen was an only child, Dave might be able to switch his family coverage to employee+ spouse or employee only. Since Dave has two more children, he will continue to keep his family coverage until the twins reach age 26 and then he can make a benefit change.
Let’s say Dave and Shelia decide to get a divorce. Dave has family dental and vision insurance, but it slips his mind that he needs to update his coverage. Several months later, Dave realizes his error. The employer or Dave may be able to recoup some of the premium paid (at the carrier’s discretion) or sometimes a special request needs to be made to the carrier.
Since Dave is removing Shelia from his plans, it would also be a good time for him to review his life beneficiary and make updates. If Dave died without updating his beneficiary after his divorce, his benefits would go to Shelia instead of his children or a possible second wife. Revising this information ensures that Dave’s wishes are fulfilled and that legal complications are avoided.
It’s important that when life changes happen, that employees review their insurance coverages to see if changes need to be made. Forgetting to make updates can result in extra premium paid or life insurance benefits inadvertently going to the wrong person.
For more information, contact your National Insurance Services Representative.
National Insurance Services is not a law firm and no opinion, suggestion, or recommendation of the firm or its employees shall constitute legal advice. Readers are advised to consult with their own attorney for a determination of their legal rights, responsibilities and liabilities, including the interpretation of any statute or regulation, or its application to the readers’ business activities.