New Jersey State Group Life Insurance Policies Conversions.

New Jersey Life Insurance Education Online and Consumer Resources answers.

Assuming you are covered by NJ group life insurance while employed, the coverage ends 31 days after you leave employment. You may continue your life insurance coverage after you leave employment by converting your Group Term Life insurance policy, without medical examination, at your own expense. This explains the information that you should consider and the rules to follow when purchasing a conversion policy.
You have the option to convert your Group Life Insurance coverage to an Permanent policy with the Prudential Insurance Company when you retire, terminate employment or lose coverage on a leave of absence without any pay. This conversion option to a Prudential policy is guaranteed (you cannot be denied coverage for health or other reasons), but it may be more expensive or less suitable to your needs than other policies for which you may qualify from other insurance carriers.

Other carriers may accept or reject your application based on their evaluation of the status of your health and other factors. If you wish to purchase a conversion policy, you have a one time option prior to the 31st day after you terminate employment. After 31 days, you will not be eligible to purchase a conversion policy without a medical exam.
To initiate the purchase of a New Jersey Group Life Conversion Policy in NJ, (not handled by the Division of Pensions and Benefits) by visiting the New Jersey Life Insurance Confidential Consumer Quote Request Form.

The conversion policy can be for any amount of insurance up to the amount that you had while employed. (In the case of a retirement the maximum amount that you can purchase will be reduced by the amount of any life insurance that you will automatically receive in retirement under your retirement plan.)
To protect your conversion privilege it is suggested that you call for prices on your conversion at the same time you file your retirement application or terminate employment.
The reduction (or elimination) of your life insurance coverage will be effective 31 days after your date of termination. If you wish to supplement this coverage with either a conversion policy from Prudential or another type of policy from Prudential or another insurance carrier, it would be best to Request Assistance at least four months prior to your retirement.

EXAMPLE: If you had group life insurance of $86,000 while employed, and that life insurance coverage drops to $6,000 at retirement, you can purchase up to $80,000 in life insurance coverage under an individual non-group policy by Requesting Assistance above before 31 days following your termination of employment.

Time will pass quickly so act now!
If you terminate employment without applying for retirement or your insured period during a leave of absence expires, you will continue to be covered for the next 31 days. Up until the end of that 31 day period, you may convert your group life insurance, without medical examination, to any individual policy customarily offered by Your Insurance Company except term insurance or a policy containing disability benefits.

If you are hired back into PUBLIC EMPLOYMENT
If you return to public employment after the purchase of a conversion policy, you must discontinue your individual conversion policy. If you do not, you will be required to submit satisfactory proof of insurability before you can be covered again in full under a group life insurance policy.
The Division of Pensions and Benefits cannot provide premium rates for converted life insurance policies. Please contact Request Assistance here! for such information.

Our Professional Resident Agent,  NJ Direct Insurance Brokerage has been helping consumers with insurance decisions since 1986.
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Why purchase Life Insurance?

Life insurance is the foundation of a sound financial plan. It provides financial security for your family by protecting your financial resources, such as your present and future income, against the uncertainties of life.

More specifically, life insurance provides cash to your family after your death. This cash (the death benefit) replaces the income you would have provided and can meet many important financial needs: It can help pay the mortgage, run the household, send your kids to college, and ensure that your dependents are not burdened with debt. The proceeds from a life insurance policy could mean that your family won't have to sell assets to pay outstanding bills or taxes. What's more, there is no federal income tax on life insurance benefits (in most cases).

Choosing the right policy.

Choosing a life insurance product is an important decision, but it can be complicated. As with any major purchase, it is important that you understand your family's needs and the options open to you. 

If you are going to make a good choice when purchasing life insurance, you need to understand what type of Life Insurance policies are available. If one type of policy does not fit your needs, then ask and find out about other available Life Insurance policies. You can research more information on life insurance policies by checking with a licensed life insurance agent or a licensed life insurance company. You can also consult life insurance books that are available in your public library, as well as life insurance information available on the Internet. 

New Jersey Group Life Insurance and Conversion Options.

Many employers, including the State of New Jersey, offer life insurance under a group plan and sometimes pay part or all of the premium. A medical exam is usually not required for insurance purchased this way, and the insurance can be less expensive than coverage purchased as an individual.
Upon separation of service or employment the group life insurance policy may be converted to a permanent policy.  This converted policy will probably be much more expensive than the group insurance.  Policies offered in this manner are different from group insurance, and you should evaluate the materials shown to you in the same way as if you were considering a purchase of an individual policy through an agent.

Research Different Policy Types
  • Term Life Insurance Policies Overview.
    Term Life Insurance provides protection for a specific period of time. It pays a benefit only if you die during the term. Some term insurance policies can be renewed when you reach the end of the term, which can be from one to 30 years. The premium rates increase at each renewal date. Many policies require that you present evidence of insurability at renewal to qualify for the lowest rates.
  • Permanent or Whole Life Insurance Policies Overview.
    Permanent or Whole Life Insurance provides lifelong protection. As long as you pay the premiums, the death benefit will be paid. These policies are designed and priced for you to keep over a long period of time. If you don't intend to keep the policy for the long term, this may be the wrong type of insurance for you. You can cancel or surrender the policy in total or in part and receive the cash value as a lump sum.
    " If you need to stop paying premiums, you can use the cash value to continue your current insurance protection for a specified time or to provide a lesser amount of protection covering you for your lifetime.
    " You usually can borrow from the insurance company, using the cash value in your life insurance as collateral. Unlike loans from most financial institutions, the loan is not dependent on credit checks or other restrictions. You ultimately must repay any loan with interest or your beneficiaries will receive a reduced death benefit. With all types of permanent policies, the cash value of a policy is different from the policy's face amount. The face amount is the money that will be paid at death or policy maturity. Cash value is the amount available if you surrender a policy before its maturity or your death. Moreover, the cash value may be affected by your insurance company's financial results or experience, which can be influenced by mortality rates, expenses, and investment earnings.
  • Different ways to purchase a policy.

    The policy number for the basic group life insurance for the following systems: Public Employees Retirement System (PERS), Teachers Pension and Annuity Fund (TPAF), Police and Firemen's Retirement System (PFRS), State Police Retirement System (SPRS), Judicial Retirement System (JRS), or Alternate Benefit Program G(ABP) :G 14800
    PERS The policy number for the contributory group life insurance for PERS: G-13900
    TPAF The policy number for the contributory group life insurance for TPAF:is G 14300
Details and important additional information to know.
  • Sales Illustrations.
     It is likely that an agent will show you one or more life insurance sales illustrations. An illustration consists of a series of numbers indicating how the policy works. The illustration usually shows the guaranteed results under the Life Insurance policy for each year in the future, and the results if all the non-guaranteed items continue at their present level. This will probably not happen as actual results may be better or worse than the non-guaranteed amounts shown in the illustration (but not worse than those that are guaranteed)
  • Notice: This website may be considered as an advertisement, and may lead to pertinent policy recommendations to NJ individuals and NJ businesses . The resources listed here are available for residents of New Jersey, USA only.