Whether you choose to purchase an individual policy or employer-provided life insurance, there are many advantages of group insurance. For starters, it is easier to administer and costs less to provide coverage through payroll deductions. You also have a greater degree of control over the amount of coverage that you need. However, the downside is that if you decide to leave the company, your coverage will be canceled. You may be left with no way to pay off debts or cover your education, but a group policy has many benefits.
Basic employer-provided life insurance is usually inexpensive or free, and you can often get supplemental coverage at low rates. Depending on your situation, it is important to know how much coverage you need. Generally, a person needs coverage worth six to 12 times their annual salary. If you have dependents, you should have coverage worth ten to twelve times your salary. While this type of coverage automatically terminates once you leave your job, it is possible for your employer to convert it to an individual permanent policy.
There are also some disadvantages to employer-provided life insurance. The basic form of the policy is inexpensive and often free. But there are supplemental policies available at low rates. The main disadvantage is that the face value is often low and you should consider the cost of additional coverage. Most experts recommend that you have coverage worth at least six times your annual salary. You should also ask your employer if they offer any group coverage for your spouse or children.
The best thing about group life insurance is that it is flexible. The employer doesn’t have to be tied to any specific insurance carrier. You can buy a more cost-efficient insurance policy elsewhere. But if you are a single parent or child, supplemental coverage is not a good choice. If you have a family, it is advisable to purchase individual life insurance for yourself or your family. And remember that if you quit your job, you won’t lose your coverage.
A good employer-provided life insurance policy will protect your loved ones in the event of your death. It will cover a number of people. It may not meet your specific needs. If you don’t work for a large company, you may want to consider purchasing a personal individual life insurance policy. If you don’t have any savings, a personal individual plan will protect your savings. If you have a large family, you may want to take advantage of group coverage.
The most important benefit of employer-provided life insurance is the fact that you can make changes to your beneficiary information. Insurers will be more apt to make adjustments for you if a spouse leaves the company. This can be a great benefit for your family. This type of insurance will help them cover unexpected medical costs and other expenses. If your spouse leaves your job, he or she will be covered for those expenses.