Questions to Ask About Life Insurance Coverage Provided by Your Employer

Workplace Benefits

4 Questions to Ask About Life Insurance Coverage Provided by Your Employer

2 min read
Aug 12, 2020

Many people enroll in life insurance coverage through work because the cost may be low and it’s easy to manage.

Usually, employers offer two types of life insurance—one is included as part of your benefits package, and you don’t pay for it. The other is group life insurance that you can purchase. Here are a few questions to consider about whether your employer-sponsored life insurance is right for you and your family.

Do you have enough coverage?

While some life insurance coverage is better than no coverage at all, it’s important to closely evaluate how much life insurance you need.

As a general rule of thumb, experts suggest having life insurance benefits up to 10 times your income. With that in mind, you can consider whether you have enough to meet your family’s needs. Don’t forget about the role that outstanding debt, like a mortgage, car payment or student loans can have on your family’s finances.

Can I change my coverage easily?

Your work life and home life are always changing, and so are your financial needs. As time goes by, your salary is likely to increase, your family might grow, or you may take on extra caregiver responsibilities as your parents get older. Your life insurance coverage should also reflect these changes. You’ll want to find out how flexible your policy is and what the cost might be to make changes.

Does my policy only cover me?

Most employer-provided insurance policies only cover the employee. If you’re married, you may want to research if your partner is also covered, either through their own employer, or by purchasing an individual policy, to help protect your family.

Will my coverage end if I change jobs?

Your employer-provided life insurance coverage may not follow you if you change jobs or if you stop working altogether. Also, benefit options may differ by employer. For those reasons, getting a group life insurance policy—outside of what your employer offers—may be a smart option.

Preparing for open enrollment? Take our benefits quiz to see what kind of life insurance policy might be right for you.

Nothing in these materials is intended to be advice for a particular situation or individual. These materials are for general information purposes only.