Alisha was elected to the position of Mutual Benefit Association (M.B.A.) Representative in 2022. Alisha has been a proud Union member since the beginning of her career. Her fight for the carriers landed her the trust of her fellow coworkers and in 2019 she was elected Shop Steward. Thanks to all the carriers who voted in the 2022 election, Alisha will represent Branch 36 members as the M.B.A.

MBA Term Life Plans

Welcome back to another article regarding the various MBA term life plans. As we start off with every article, which I’m sure you’re all familiar with by now, we’ll discuss the significance and importance of these term life insurance plans. The simplest comparison that we’ve made to these insurance plans is that a plan can’t be successful without preparation. Now, for those of you who aren’t familiar or may need a refresher on what that means, a plan is making a goal that you’re looking to achieve in the short or long term by taking the necessary steps to achieve it. Preparation is taking the steps or actions within the plan to achieve that goal.
Throughout the articles, we’ve stated how insurance is typically, in a sense, a type of plan. Understandably, insurance policies and programs are a little bit more complex depending on the coverage. But ultimately, both insurance plans have the same overall purpose, where you’re putting away money towards a plan, which has been set in place to cover you in a situation so that you’re prepared when it occurs. We’ve established that you get insurance to protect yourself or the things that you hold valuable. As we’ve stated, yes, insurance policies are a little bit more complicated. However, that’s all dependent on the type of insurance coverage that you’re getting and what the policy entails.
We’re here to focus on the MBA term life insurance plans that are offered to NALC members and their families. In the past few articles, we’ve covered the various life insurance programs offered by MBA, and we’ve seen how each overall insurance plan is specifically tailored to the unique situations of every NALC member and their families.
Today’s article is going to focus on two MBA plans: the MBA Term to Age 65 plan and the MBA 20-Year Term plan. The MBA Term to Age 65 plan is made to cover any NALC member with insurance protection until they reach the insured age of 65, at which point they have two options on what they can do with the plan. The policy will remain in force until the anniversary when the insured reaches age 65. The premium rate is based on the current age of the insured and the amount of insurance desired through the plan. Once these two factors are established, the premium rate will never increase during the lifetime of the policyholder, so long as the premiums are paid on the policy. As long as those criteria are met, the policyholder is guaranteed life insurance until they reach the age of 65. Now, should something happen to the policyholder, say an untimely death, the policy will pay out the full amount to any listed beneficiaries, as long as it’s in force. This plan is usually for individuals who feel they may not need any extra insurance during their retirement years from the Postal Service.
The next plan we’re covering is the MBA 20-Year Term plan, which is similar to the MBA Term to Age 65. However, the key difference between these two plans is the time span of coverage. It’s the same deal where the insurer offers insurance protection, except it’s for a period of 20 years. The premium rate is again based on the current age of the policyholder and the amount of life insurance they apply for. As with the other plan, the premium rate will never increase throughout the 20-year term, as long as the premiums are paid on the policy, and the insured is guaranteed life insurance for that period. As with the other plan, should the insured meet an untimely death, the full amount of the policy will then be transferred to the next listed beneficiary.
So, we see that both of these term insurance plans are very similar in the policies they offer. To put it simply in terms of our rainy-day fund analogy, think of it as hav¬ing a long-term rainy-day fund instead of a short-term one. For example, say you’re collecting a rainy-day fund to save for a vacation, you know that’ll take you maybe 90 days or so to save up for. Now say you have a rainy-day fund where you’re looking to buy a car. Well, of course it’s going to take you a little bit longer to save up money and carry out your plan to pay for it. We can think of both term insurance plans this way, where you have the insurance plan in place and you’re paying into it for however long you feel you need to. And depending on how much you pay into it, you’re still guaranteed life insurance protection, and your family is granted that as well should you meet an untimely death.
The key purpose of these plans is knowing how you want to save your money and how long you want to save into the life insurance plan. With these two plans, we see the possible options you can take in terms of how you want to approach this question. Do you want to save until you reach the proper retirement age, or would you rather do something short term and save up for the next 20 years; figuring that by then you should have more than enough by the time you’re ready to retire from the postal service? So as with any insurance plan, we see that the option to save is always in our hands.