Is Your Employer Life Insurance or Group Life Insurance Meeting Your Needs?
If you work full-time, your employer may have provided you with life insurance. As part of an employee benefits package, group life insurance is sometimes available. If you desire more coverage, you may be able to acquire a supplemental life insurance policy via your employer.
You may believe that having life insurance via your employer is sufficient. However, if you don’t evaluate all of your options, you may be jeopardizing the financial future of your loved ones. Here’s all you need to know about group life insurance at work.
The Benefits of Purchasing Life Insurance Through Your Employer
A practical option is to purchase group life insurance via your employer. Employees may be offered a life insurance policy for free or at a reduced rate by their employer as a method to boost benefits and keep them engaged.
Another advantage of employer-provided life insurance is that you may be able to obtain coverage even if you would not be eligible for one on your own. If you have a medical issue and are looking for term life insurance, for example, getting accepted by an outside provider may be more challenging.
Make sure you understand the details of your work life insurance policy. When you reach a specific age or retire, some policies will expire. That is why, in addition to another coverage, obtaining a group work life insurance policy may make sense.
Supplemental Life Insurance: What It Is and How It Works
Supplemental life insurance is a type of group life insurance that you can buy in addition to your employer’s coverage. If you require additional coverage beyond what your work provides, you may be able to get it through us, or the same company your employer uses.
Supplemental life insurance is frequently more expensive than getting an individual coverage. On the other hand, supplemental life insurance may be a good choice if you’re having difficulties getting approved for life insurance through outsider programs.
Why You Might Need More Than Your Employer’s Life Insurance
Getting life insurance via your employer can be a good place to start, especially if you don’t have one now. However, you should be aware that if you lose or quit your employment, your life insurance coverage may be lost as well.
During their working lives, the average worker changes employment at least 12 times.
At some time, you’ll have to think about what happens to your employment life insurance coverage after you quit. You also don’t want to feel obligated to stay at a job you despise because you have group life insurance and won’t be able to find a better policy if you leave.
In rare situations, you may not be able to transfer your old work life insurance policy to a policy with your new job or convert your work life insurance policy to an individual plan. To learn more about your possibilities, speak with the human resources department at your place of business. There will be a coverage gap if there is a time between you leaving your former employment and seeking a new one.
Other Things to Think About When Buying Life Insurance
You should also check to see if your work life insurance policy fully covers all of your and your family’s financial demands. Consider the following:
Do you have any kids?
Do you and your spouse have bills that must be paid with both salaries, such as a mortgage?
Is your partner and/or family financially dependent on you?
How many benefits, such as bonuses, commissions, medical insurance, and retirement contributions, are not covered by your work life insurance policy?
If you’re young and unmarried, you may want to remain with your employer-provided life insurance. However, keep in mind that the younger and healthier you are, the less expensive your life insurance policy will be. Certain health issues may also prevent you from becoming eligible.
If you lose your job-based life insurance and apply for personal life insurance, the costs could be significantly higher than if you had acquired life insurance years ago – and that’s assuming you’re approved. If you want to start a family in the future, buying one now can help you save money on your insurance.
Furthermore, an individual life insurance plan may be less expensive than an employment plan in some situations, especially if you retain good health throughout your life. Even if you stay healthy, your work life insurance premiums may grow as you get older. By getting your own personal plan now, you can lock in reduced pricing.
How to Calculate the Amount of Life Insurance Coverage You Require
Many people utilize their employer-provided life insurance as a backup to a larger private coverage. If you have dependents, a life insurance policy that covers 10 times your yearly income can ensure that your loved ones are protected for many years. If your employer’s policy doesn’t come close to covering you, it’s generally better to look into a larger term or permanent life insurance policy. Talk to one of our agents before you buy a policy to ensure you’re properly covered and figure out your potential life insurance rates.
It’s also a good idea to review your life insurance coverage whenever your living expenditures rise. If you earn more money at work and have greater costs, you should make sure your life insurance policy reflects this. Working with your family’s financial advisor to establish what coverage you require is the best course of action. Make sure you are insured now, before it is too late and you are no longer eligible or costs rise.
If your employer offers you a free or low-cost life insurance policy, you should probably take advantage of it. However, you may require additional coverage to give your loved ones the complete protection they deserve.