When it comes to life insurance, many people breathe a sigh of relief knowing their employer provides coverage. And that’s great, it’s a valuable benefit. But here’s the truth: while employer-provided life insurance is a helpful start, it usually isn’t enough to fully protect your loved ones if the unexpected happens.
This isn’t about overspending or buying more than you need. It’s about ensuring that the people who depend on you are covered in a way that truly suits your life. Let’s break down why relying only on work-sponsored life insurance could leave some important gaps.
The Coverage Amount Is Often Too Low
Most employer plans offer a death benefit of one to two times your annual salary. Financial experts generally recommend ten to fifteen times your salary to cover long-term needs like:
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Mortgage or rent payments
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Childcare and education
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Everyday living expenses for your family
When you put the numbers side by side, it’s easy to see how quickly a work policy might fall short. Use this Life Insurance Calculator to get a clearer picture of how much coverage your family may actually need.
Why Employer Life Insurance Isn’t Portable
Employer coverage usually ends when your job does. That means if you leave, retire, or get laid off, the protection also goes away. Unfortunately, life insurance costs more as you age, and health conditions can make it harder (or more expensive) to qualify later.
Having your own policy ensures you’re protected no matter where your career takes you.
One-Size-Fits-All Coverage Leaves Gaps
Your employer’s life insurance is designed to cover many employees, not your unique situation. It likely doesn’t account for:
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A spouse or children who depend on your income
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Outstanding debts or large financial goals
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Legacy planning or caring for aging parents
A personal policy gives you the flexibility to choose the right amount and type of coverage for your family.
Employer Life Insurance Should Be a Supplement
Think of your employer’s life insurance as a helpful bonus, not the foundation. The smart approach is combining it with a personal policy that’s tailored to your needs. This way, you get the best of both worlds: free or low-cost coverage from work plus the stability and control of your own plan.
Your employer’s life insurance is a valuable perk, but it’s rarely enough on its own. Protecting your family’s financial future isn’t about buying more than you need; it’s about making sure what you have is truly enough.
If you’re unsure whether your current coverage meets your needs, a conversation with your agent can help. Together, you can review your employer’s plan, calculate what your family would need, and build a strategy that gives you peace of mind today and security for tomorrow. Reach out to us today to get started.
