When thinking about life insurance you want to think about your life – your entire life.
What are your insurance needs today and into the future? What do you want to protect – income and assets? Who do you want to protect? Do you want to protect your income and assets at the lowest possible price with the minimum coverage or do you want something more, possibly being able to make money?
One thing is almost for certain – your employer provided insurance may not be what you need, or even want. While group polices often accept everyone, up to a certain amount, without a medical exam they may not be your best option. You may want to supplement your employer policy or even forgo your employer’s insurance. The time to get insurance is before you need it.
Here are 5 reasons you may want to consider life insurance beyond what your employer offers:
- Sufficiency: May not be enough to meet your needs.
- Type or Structure: May not have the best structure for your needs
- Portability: May not continue if you lose your job, leave or retire?
- Controllability: Employer decides what policies and carriers are used and can change or be dropped at anytime
- Insurability: If your health changes you may not be eligible for a new policy or have the same cost
Let’s look at each of these more in-depth.
Sufficiency: Does your employer policy have enough coverage. Frequently employers offer free life insurance valued at 1x your annual salary. Depending on the company and your your level in the organization you may also be able to purchase insurance up to 7x your salary and have options to purchase universal life and accidental death and dismemberment insurance.
If you are looking for coverage to support your family in the case of your death you really must add up all of the costs you want to cover. Mortgage, costs of childcare and the expenses of raising a child (sports fees, music lessons, meals on the run, clothing, food, health insurance, braces, etc.), spousal support and so on. It may not take long to realize that you need more insurance that your employer offers.
Have you ever actually looked to see what these policies cover? Are they the most cost-effective option for you? What if you could get more coverage for less money? Most employer polices don’t offer a living benefits rider – the ability to access part of the value of the policy if you have certain costly, potentially life-threatening health issues. Your employer life insurance is literally death insurance that your beneficiaries collect, and it is of no help to you while you are alive.
Type or Structure: There are many different types of life insurance in the market, though employers usually offer only the most simple, and not necessarily the best options. The primary insurance you employer is likely to offer is term life insurance, the least expensive life insurance, good for a specified amount of time and then it ends. Employer offered term insurance plans usually don’t have living benefits riders that allow you to access some of the policy to pay for medical costs.
Another type of insurance offered is universal life. Universal life plans are a form of permanent insurance that you can keep throughout your life at a fixed premium. They also include a savings component where a portion of the premium is saved, a cash accumulation. While this sounds like a nice benefit, having the ability to have some insurance even after your term life policy expires plus some extra cash savings, these policies are usually structured to be heaving on the premium and very low on the savings. You may find yourself paying for a policy for years and have little to show for it. There very likely are better policies you can buy outside your employer for the same amount or get more benefit or a slightly higher premium. Shouldn’t you know what your options are?
Portability: What happens to your life insurance policy when you leave your employer, whether by your choice or not? Will your policy be terminated? Even if you have the option of keeping your policy, certainly any portion of the policy your former employer was paying for will not have to be paid for by you. And, is the policy you have any good? It was likely the least costly option for your employer, but is it your best option? Forget depending on your employer for a substandard policy. Why not just buy the policy you need and keep it regardless of who you are employed by?
Controllability: With an employer plan you provide the plan and the insurance carrier. You have no choice. Wouldn’t you rather have options available to choose from? Would you rather be the one decide which type of policy, what protections and benefits are available, which carrier and at what price you would rather purchase?
Insurability: What happens when you lose or end your employer insurance? Will you be able to get insurance in the future? Will you get a good price? Life insurance premiums depend on your health. What if you have excellent health today but in 10 years develop a health condition like diabetes, cancer, or heart disease? What if you gain weight? Even if you don’t, you’ll be 10 years older with prices increases that correspond. Do you want to be in the position of losing your life insurance and then wishing you had your own policy years ago?
Insurance is all about risk.
We all hope we never need insurance and if we do need it wish we had it.
You need to take a good hard look at your needs today, the policies you currently have , and what you will need in the future. Until you have a comprehensive review of your life, policies and needs it’s impossible to say whether your employer coverage is sufficient for you.
For many people who do a review they come to the conclusion they want a combination of employer plans and their own independent plan
Contact us to schedule your comprehensive review today. Only you really know what your needs and preferences are and only you can decide what is best. Make an informed decision not a default decision.
Keith Hatchett and the GoInsurancePAL Difference
At GoInsurancePAL we help you to secure your life, health, money and wealth. We do this by finding or creating unique insurance products to meet your personal goals.
“At GoInsurancePAL we don’t sell insurance, we help you build the lifestyle you want – and deserve.”
Rather than try to sell you a generic off-the-shelf policy we work with you to understand your goals. Then, we explain the options that can help you meet your goals. It’s your choice to make. Often, our clients are surprised to see us increase their total benefits while reducing their total out-of-pocket costs – all tax free.
Think of us as your coach. In life, like sports, to win you need to have both a strong offense and a strong defense. We explain how you can have strong offense and strong defense, not the cheapest defense that won’t meet your needs when you need it most. Like a good coach, we teach you, giving you the knowledge to make informed decisions.
GoInsurancePAL is independently owned and operated. This allows us the freedom to work with many insurance carriers to find the best recommendations for you.
In 2011 Keith Hatchett founded GoInsurancePAL after getting sick of seeing insurance agents take advantage of people and selling the wrong products for their needs. It’s motivated Keith to create new products, like his solution to the Affordable Care Act. Keith’s caring for his customers goes beyond insurance. Since then, Keith and GoInsurancePAL have continued to lead the way innovating insurance products to best serve the needs of his clients. Contact us today for a no pressure discussion and evaluation of your personal situation.
