Whether you are just entering the workforce or have been longtime, even tenured, employee, one benefit of full-time employment is found in insurance opportunities. The paycheck deduction may not seem like a valuable expenditure but once you need to use your insurance, the value seems worth the cost. Oversight with insurance often comes from misconceptions regarding life insurance.
More often than not, employment life insurance policies do not provide the depth and breadth of services most individuals require. This means that if individuals build families, age, and inevitably need more they may not be covered in the event of the unexpected. Additional external policies can provide coverage when their employer’s group policy cannot.
Group Policy Difficulty
Unfortunately, employers provide policies that are organized through group pricing. This allows the organization to provide for its employees but maintains a functional cost structure. Things can fall through the cracks with the group policies. Certain offerings might be exemptions in these policies. Many see these kinds of gaps in coverage in the fine print of their health insurance plans. However, because life insurance is often misconstrued as a distant, abstract concept, the fine print of life insurance is overlooked.
In employer life insurance policies, the coverage is often only one times the annual salary of the individual. While some employers offer two or even three times annual salary, this still may not provide the proper coverage. Individuals with families, children, school debt, or other debt will in order to support their families adequately in an already exceptionally difficult time.
Many life insurance policies through employers also do not extend after retirement. As a result, individuals are left unprotected. Retaining life insurance that is readily available beyond employment offers a supportive buffer. Personal or private policies make up for the lapse and uncertainty when employment policies lapse or are discontinued.
Additionally, policies through your employer are at the will of your employer. Simply put, if you change jobs, your policy won’t be upheld. And even if you remain in your position, your employer may decide to cancel or discontinue the life insurance.
Personal Policy, Personal Needs
Looking for personal life insurance policies may seem daunting. Doing your research before committing to a policy is just as important as finding the right organization to provide the policy. Understanding what is, can be, and is not provided for is essential to ensuring that you are getting exactly what fits your circumstances best.
The three primary policy options are:
- Term Life Insurance
- Universal Life Insurance
- Whole Life Insurance
Each of these offers different things based on the needs of the individual taking out the policy. Each institution handles things differently but the general sentiment of each respective policy type remains the same. Speaking with an external insurance provider on the details of their policy offerings, paired with being informed yourself, will give you both the best opportunity for finding your perfect plan.