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Don’t Rely on Your Employer’s Life Insurance Policy

Portrait of Happy Family in a ParkYour employer offers a life insurance policy to its workers, a terrific benefit for all of you. So you might make the mistake of thinking that you don’t need to purchase your own, separate policy. You’re covered , right?

Sometimes, yes. Depending upon the terms of your company’s life insurance policy, your family might be very well protected in the event that something happens to you. On the other hand limited. There are several very good reasons that you should at least consider purchasing your own, separate policy.

It’s not guaranteed. If your company ever needs to make budget cuts for any reason, optional benefits like life insurance for employees are often the first cuts to be made. You could even miss the notification that your insurance is canceled, and find yourself uninsured in a tragic situation. The policy also might not be portable, in the event that you need to change employers at some point in the future.

It might not offer enough coverage. Company-sponsored life insurance policies are often quite basic. Your policy might cover burial expenses, or perhaps a bit more. But most people don’t know how much coverage they truly need, in order to fully protect their loved ones. A needs analysis can help you discover how much insurance you need (we can help with this). In most cases, employer-provided life insurance won’t offer full protection for your income.

Your health status can change. The younger and a better chance at securing an affordable life insurance policy that offers terrific coverage. As you get older, or develop health conditions, it gets harder to buy into the best policies. It’s better to shop for life insurance now, rather than waiting too late.

Check out the exclusions. In some cases, employer-sponsored life insurance only covers you in the event of a job-related accident, or there are other major exclusions to your coverage. Unless your death falls under very specific parameters, your beneficiaries might not receive a payout of benefits at all.

As you can see, looking into this issue now can save your loved ones a lot of hassle and help you decide how to best protect your family.