Why Buy Life Insurance Outside of Work?

Life insurance provided by your employer is a wonderful benefit, and an easy way to get some coverage with little to no cost involved, but is it enough? 

When it comes to your family's financial future, it is always good to plan ahead. Employer provided life insurance is group life insurance. It is usually cheap, easily attainable, and wonderful when you have an insurability issue because generally, you’re approved as long as you’re an employee. It is usually low-cost or free. However, it should not be used in place of having a life insurance policy of your own outside the workplace for many reasons. 

Coverage amount is not enough. Employers typically offer coverage amounts equal to your salary, which may not be enough to properly protect your family beyond a few months. Let’s say you have a young child. If something happens to you and your company gives your spouse one year’s worth of salary, will that be enough to take care of the child for the next ten years or so? You usually aren’t able to customize the policy features selected by your employer such as additional terms and conditions that enhance your coverage for specific situations.

You can't take your policy with you.  If you leave the company for whatever reason, the life insurance usually terminates about a month after you leave your job, and you end up with no protection. In some cases, you may be able to convert your employer owned life insurance coverage to an individual whole life policy. This option will come with a higher rate.
 
Ownership. When you have life insurance through work, the company owns the policy. The benefit amount is typically not more than a year’s salary. They could also choose to get rid of that benefit all together. You should always have ownership of YOUR life insurance policy.

• Ownership – You own the policy, and it goes with you no matter where you work.
• Insurability – You are guaranteed protection for the life of your policy as long as you pay your premium, not just while you are employed.
• Amount of Coverage – You can purchase a lot more coverage than would be available through your employer-provided plan.

Watch this video....

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​These are a few reasons why you want to have coverage outside of work. Yes, take employer coverage, but you should own what you need. With that said, do you need coverage outside your employer? I am happy to speak with you about your needs, and work with you to get you properly protected. Schedule a consultation, let's talk.