Chances are, your employer has offered you the opportunity to buy into their group life insurance policy. Maybe they’ve offered you the opportunity to purchase a modest life insurance policy for your spouse, too.
The cost of the premiums are affordable for your level of income and no medical exam is required. Maybe you’ve even been provided a $100,000 policy at no cost to you.
Sounds adequate, right?
After all, $100,000 is quite a bit of money to a middle-class family. Unfortunately, even a sizeable six figure policy may not be enough. In fact, many financial analysts and insurance agents recommend purchasing more than five times the amount of your annual income.
All too often people assume that when a spouse passes unexpectedly, that they are losing an income – and they’re right – partially. You see, the loss of a spouse, aside from the emotional loss, also comes with a huge financial loss – more-so than just an annual salary.
When financial planning for the unexpected, people often fail to take into account the loss of bonuses, healthcare benefits, and other sources of income that will also be lost in the event of their spouse’s passing. So, that $100,000 that once made it seem as though your employer was really taking care of you, doesn’t sound so sufficient anymore, does it?
Have you ever considered the portability of your employer provided life insurance policy? How secure is your career? If your company closes, you’re let go or laid off, or if you are faced with the difficult choice of having to leave your job due to a decline in health, will you be able to maintain your group policy provided through an employer that you no longer work for?
Chances are, probably not.
A big problem with employer provided life insurance policies is that they are really only helpful, to some degree, when you’re employed through the entity that offered you the group buy-in opportunity. If you’re considering a career change, don’t have solid job security, or any of the aforementioned scenarios should occur, your family may not be protected.
Maybe you’re thinking, “I’ll just get a private life insurance policy if I leave my job.” Think again. What if you’re not healthy enough to obtain a policy at an affordable premium? What if you’re not eligible at all?
It’s never a good idea to bank on unpredictable factors like health, job security, or life expectancy. When it comes to protecting your family financially through the purchasing of life insurance, it’s best not to leave anything to chance – avoid allowing gaps in your life insurance coverage.
Luckily, as a diabetic, you can find affordable life insurance and you may want to consider this even with your company provided policy.
We all want what is best for our families – and when we’re offered a policy with the potential to provide further security for our family, it’s easy to be blinded by the luster of the comfort that accompanies the peace of mind.
It’s important to consider all expenses, all financial losses, policy portability and to fully consider the grieving process and its financial impact when determining whether your company life insurance policy is sufficient. You may be surprised by the mass of more cost efficient, higher coverage policies that are available to you.