Is Employer-Provided Life Insurance Enough Protection?

Life insurance is often a policy that is hard to discuss with people. No one wants to think about, much less talk about, life after death. But it’s important to be proactive and put the future ahead of your emotions. It may also seem great that your employer is offering life insurance through a group plan, but what happens when you no longer work there or retire? You won’t have those benefits and your dependents are left with financial burden. Employer-provided life insurance has it’s perks, but individual plans can be more beneficial.

A new survey from LIMRA states that 108 million Americans have life insurance through their employer while 102 million Americans have an individual plan. That is the first-time group coverage has been more popular than individual plans. This could largely be due to the fact that most people are uneducated about individual plans and what they can offer. Employer-provided life insurance isn’t necessarily enough.

If you’re young and just graduated from college with no dependents, life insurance is still an option for you. What happens if you pass unexpectedly? Your loans now become another distress on your family. Life insurance policies are generally much cheaper when you’re younger, so all more of a reason to try to grab a policy.

Perks of individual plans:

  • Lock in a cheaper rate for a longer time period.
  • Change jobs as many times as you’d like and still have coverage.
  • Have your own contract.
  • The insurance company cannot cancel your insurance, only you can.
  • Buy as much coverage as you think your family will need.

These are just a few pros to what an individual plan can provide to you. Some can act as investment opportunities and others can act as a way for you to accrue money for retirement. But as with any product out there, it’s important to list the cons of individual life insurance so you can decide on what’s best for you.

Cons of individual plans:

  • More expensive
  • Difficult to buy at a higher age
  • Some underwriting

The most important take-away from this article is that life insurance is necessary for everyone. It’s not just about investment opportunities or whether you believe it’s a necessary expenditure or not. It’s about ensuring the safety and comfortable living of the loved ones close to you.

Since insurance is oftentimes overwhelmingly confusing, we want to shed light on this industry by answering YOUR questions.  So if you have any questions or concerns, comment below and your question may be the topic of our next article!

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