The Federal Starr
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The Federal Starr

How Does Life Insurance Work?

Life insurance is a topic some people avoid. No one wants to think about their death. But many of us are concerned about the well-being of the people we will leave behind.

That is what life insurance is — financial protection for your loved ones, whether it is for funeral costs, mortgage payments, loans, or to cover the cost of day-to-day living.

Your life insurance policy is your contractual agreement specifying the coverage and cost for you as a policyholder with your insurance carrier. Your insurance carrier pays a death benefit to your beneficiary, whether that is your spouse, children, or anyone else you choose.

Who Needs Life Insurance?

· Anyone with responsibilities

· In a national survey one in five said they did not have enough life insurance.

· Consumers tend to overestimate the cost of life insurance. One study said that 44 percent of Millennials overestimate the cost at five times the actual amount.[i]

You might think life insurance is primarily for a married couple with children and a mortgage. But life insurance should be part of almost everyone’s financial plan.

Young professionals may have credit card debt, student loans to pay, or even a mortgage. If you have a co-signer for your loans, they may become responsible for your debt. If you are planning on getting married or buying a home in the future, locking into a lower rate when you are young is a good investment strategy.

Just married — traditional marriage vows state “until death do us part.” With so many families needing two incomes to pay their bills, the death of a spouse can be financially as well as emotionally devastating. Making sure both spouses have one less worry after you have died is a way “to love and to cherish” them. According to a survey by the Life Insurance and Market Research Association, just 56% of women have life insurance coverage in place compared to 62% of men.[ii]

You are a parent — whether it is paying for childcare or college, raising a child is expensive. If your children are still living with you at home, you want to provide them with a stable environment as they grieve your loss. Imagine how they would feel if addition to losing someone they love, they also lost their home.

You are retired — Long term financial planning is a challenge. If you are still paying off a mortgage or are concerned about tapping into your retirement nest egg too early, life insurance protects your financial future.

You support aging parents — According to a 2018 AARP Public Policy Institute report, about 6.2 million millennials are caregivers for a parent, in-law, or grandparent.[iii] You can protect them if you die before them whether they need help with day-to-day living expenses or long-term care

You have a dangerous job — Many federal employees are in hazardous jobs, especially law enforcement. You can better protect your family by making sure they are taken care of if something happens to you.

How Much Life Insurance Do You Need?

Financial planners have various formulas for how much life insurance you need. Some suggest it should equal enough to pay off a mortgage while others suggest it be 10–12 times your salary.

The best approach is to look at your financial picture, both short term, and long term. How much do you owe? How much do you have saved? What is or will be your retirement income? What expenses can you project such as college for your kids? You may want to talk to a financial planner or accountant to help determine what is best for you.

Is there a life insurance plan designed for federal employees?

Life insurance from Starr Wright USA is designed to meet the needs of federal employees and their families. You can choose the level of life insurance coverage to fit your needs at affordable group insurance rates. Plans are available for retired, part-time, and full-time federal employees.

Starr Wright federal employee life insurance coverage is portable. You can keep it even if you change jobs or retire (as long as you pay premiums when due, the group policy remains in force, and you remain eligible for benefits). There are even plans for up to age 74.

Starr Wright USA offers three plans:

An Accelerated Life Benefit provides eligible terminally ill insureds with the option to receive a portion of their death benefit while still alive. Other unique features include a “30-Day Free Look” to review your plan, Voya Travel Assistance services are provided with our life insurance plans at no extra charge to you, as are Funeral Planning & Concierge services.

To learn more, visit

This is only a brief description of the coverage(s) available. The policy will contain reductions, limitations, exclusions, and termination provisions. For costs and complete details of the coverage(s) contact us at 800–424–9801. Group Term Life Insurance underwritten by ReliaStar Life Insurance Company, a member of the Voya® family of companies.

Article authored by Starr Wright USA.

Starr Wright USA is a marketing name for Starr Wright Insurance Agency, Inc. and its affiliate(s). Starr Wright USA is an insurance agency specializing in insurance solutions for federal employees and federal contractors. For more information, visit Starr Wright USA is a division of Starr Insurance Companies, which is a marketing name for the operating insurance and travel assistance companies and subsidiaries of Starr International Company, Inc. and for the investment business of C.V. Starr & Co., Inc.

[i] Facts and Statistics: Life Insurance

[ii] Facts About Life 2019

[iii] 7 reasons you may need life insurance, even if you think you don’t

Life Insurance: There’s Something For Everyone

PERSONAL FINANCE: 5 things you might be surprised to learn about insurance

How Much Life Insurance Do I Need?



The Federal Starr arms federal employees with the wisdom and insight to successfully navigate their career, create stability for themselves and their family, and continue on their mission to serve the public. The Federal Starr is a publication by Starr Wright USA.

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