The best job offerings come with numerous benefits. These benefits include insurance benefits, paid leaves, allowances, and many others overseen by the personnel department to motivate employees. However, if your employer provides group life insurance for staff members, it is rarely ever the case that this plan is sufficient by itself.
When Can Employer-Provided Insurance Be Sufficient?
Employer-provided life insurance might be sufficient if you are a single employee with no children or other dependents. This is because there will be no significant expenses to be covered by death benefits. Also, if your spouse is employed and their employer provides good life insurance for them, yours might be sufficient, provided that there are no other dependents.
Primary Benefits of Employer-Provided Insurance
These plans are usually free and easy to enroll in without a medical examination. Therefore, it takes away the difficulty that comes with getting life insurance if your health is compromised. In addition, the registration process only requires you to fill a form and name a beneficiary.
Major Limitations of Employer-Provided Insurance
There are numerous limitations of employer-provided life insurance, requiring you to consider additional options for you and your family members. Some of these limitations include:
Employer-Provided Insurance Is Usually Insufficient?
The value of your life insurance should be able to cater to the living expenses of your dependents for a couple of years if deemed appropriate. However, most of the employment-based plans are designed based on your salary. This means that the benefits can be three to four times the value of your annual pay. Sadly, most employees get about $100,000, which becomes insufficient when college tuition, health, and other expenses come into the equation.
Contingency Factors Associated with Employer-Provided Insurance
The validity of such life insurance plans is hinged heavily on the state of your employment. It is usually terminated if you lose your job or cannot keep working based on health reasons. Also, your employer reserves the right to drop the insurance plan, probably in a bid to conserve funds. You want to be prepared for times like these. Hence, a supplementary life insurance plan is a good choice. Fortunately, there is a conversion process to retain the life insurance as you move on to another job. However, this option is not offered by all policy providers.
Economic Disadvantages of Employer-Provided Insurance
The group life insurance policies pull resources from every beneficiary, which is used to cover unhealthy employee costs and would otherwise have been unfit to obtain life insurance. It would help if you also considered that the better coverage such plans provide, the more expensive they tend to become. Premiums are known to rise as you age and become more prone to diseases.
A life insurance policy ensures that your family is taken care of if something wrong happens to you. Hence, it is best if you opt for a personalized insurance plan with affordable premiums and deductibles. So, contact our team of life insurance experts at Randy Jones Insurance today! Let our insurance professionals help you find a good plan the Randy Jones way.