Last week we began looking at the second category in Box 2 of our important documents. These life insurance documents take up three file openings because I choose one opening per person or policy.

The first opening holds our head of household, my husband Paul’s life insurance documents. Within this file slot are three bundles of documents. The first (covered last week) is the term life insurance paperwork. The second bundle is the combination life insurance and long-term care insurance information.

Combination Life Insurance and Long-term Care Insurance

Where the term life insurance policy is a personal policy for which we applied and appears on Paul’s MIB report, this combination life and long-care policy is a group policy gained through Paul’s employer and is not reported on his MIB report.

This combination policy is currently a life insurance policy since Paul does not need the long-term care benefits. At open or annual enrollment, we can increase the amount of coverage.

Though this policy is held at a group rate, Paul owns the policy. If his employment ends with his employer, then the payroll deduction will end. But we can continue to hold the coverage by paying the premiums directly to the insurance company.

The documents kept in this bundle include:

1. Change notifications. Choosing to automatically increase the value each year, we receive notification of the new premium amount, new face value, and the date of the change.

2. Endorsements. Through an endorsement, the insurance company informs us of any additions or subtractions to our riders on this policy. I add these notices to this file for confirmation of coverage.

3. Beneficiary Designations. All written verifications or changes to the beneficiary designations get filed with the policy.

4. Policy. Detailing this insurance contract, the policy stays in this file.

5. Application for insurance. Though this group policy did not require a physical exam, Paul still needed to apply. During an annual or open enrollment session, Paul answered health questions and chose the amount of coverage.

With the completed electronic application, we requested a copy. Though Paul’s coverage is in force, I still keep the application documentation in this file.

Paper clipped together, these documents stay behind the term life insurance documentation in this second file opening.

Keeping the documentation surrounding the policy allows me to find the answers I need when accessing this insurance coverage. Whether you have personal life insurance, group life insurance, or applying for insurance, keep your paperwork organized and appoint a file opening for those documents. Good job plugging along. Happy organizing!

Question: What type of life insurance policies do you hold? Please add your answer to the comments.

After finishing the first file opening last week in Box 2 of our important documents, we are ready to begin the second opening which begins the second category, life insurance.

In my filing system, I have dedicated three openings (slots 2 -4) for life insurance:

Slot 2: Paul’s policies – Head of Household

Slot 3: Tracy’s policies – Spouse

Slot 4: Children’s policy – Children

Your file will differ from mine. Remember, I am sharing my file to give you an example of setting up a filing system. The important part is to appoint one file opening per person. This arrangement will keep the documents organized. In my system, the second file opening holds all life insurance policies for my husband, the head of our household.

Head of Household

We carry three types of policies for Paul:

• Part 1 – Term Life Insurance
• Part 2 – Combination whole life and long-term care
• Part 3 – Accidental death insurance

Term Life Insurance Policy

The bulk of our insurance is held in term life insurance. Having used Suze Orman’s recommendation, we purchased our term life insurance policies through SelectQuote. This company researches the available options and handles your process from start to finish. I have found this company very helpful in securing our term life insurance policies.

Behind the summary page, I keep the following documents on Paul’s term life insurance policy:

1. Receipts or billing notices indicating the date, payment amount, and payment type. With this term life insurance, we pay an annual premium for the life of the term. To prove the annual payment, I keep these receipts.

2. Beneficiary Changes and Notifications. Any correspondence from the insurance company regarding the beneficiary designations resides behind the payment receipts.

3. Policy Changes. Our insurance company extended the term of our policy by a week due to a processing delay. This information is kept behind the beneficiary notifications.

4. Policy. This 20+ page document is our contract with the insurance company of how, what, where, when, and how much they will pay in the event Paul passes away. (I know this information is not easy to process because you are preparing for the worst. However, time spent now will ease your stress level should you need these documents.)

5. Additional Correspondence. The last items in the bundle of term life insurance for Paul are the application, copy of first payment, and notes from Select Quote conversations.

Placed together, these items are paper clipped. These items are the first of three bundles housed in the second file opening of Box 2.

Annually reviewing your important documents is easier when the paperwork is housed together, assigned a designated place, placed in that designated space, and you remember the designated place. 🙂 Keep using time wisely as you organize your important documents!

Question: When was the last time you reviewed your beneficiary notifications? Please add your answer to the comments.