How does life insurance work from my employer?
Many employers offer a certain amount of group life insurance as a workplace perk, and subsidize some or all of the premiums. Often, you can buy additional coverage through your employer’s plan.
If your employer offers group life insurance, it’s a good idea to take advantage of it, especially if you have no other coverage. Be aware, though, that it applies to the employee only, not to a spouse or children. When trying to decide whether it’s enough protection, ask yourself these important questions:
- Does my employer-provided life insurance meet my needs?
- What happens to my employer coverage if I change jobs?
- Do I have plenty of coverage if my employer cancels their plan?
Multiple life insurance policies allow you to add coverage as your needs and financial goals evolve. It’s also cost-effective, because you’re paying for coverage only when you need it. Sure, more than one policy means more paperwork to keep track of, plus multiple premium payments. And you’ll likely pay more for policies added later in life. Still, the peace of mind while you’re alive and financial security for your loved ones in later years are certainly worth it.