Policy Types

Life Insurance Through Your Workplace

Some people rely on group life insurance offered through their work rather than owning an independent policy. If you have life insurance through your employer, know about your policy limits.

Employer-Sponsored Life Insurance

What You Need to Know About Your Policy at Work

According to a recent study, 80 percent of Americans say that life insurance is something they need; however, only 44 percent have individually purchased a policy.¹ This statistic indicates that many of us are relying heavily on the group life insurance offered through work instead of owning a policy independent of our jobs.

Does your company or your spouse’s company offer free or inexpensive life insurance as part of your group benefits package?If the answer is yes, great! Having some form of life insurance is better than nothing at all. And group life insurance can be an affordable way to get a policy established, often without having to undergo a medical exam. However, there are aspects of employer-sponsored plans that you should know about.

Low limits and fewer options

Unfortunately, too many people go year after year thinking that their families will be financially protected through their group life insurance. But what they may not know is that limits offered through group plans can be on the low side. Depending on the plan, life policies through work can sometimes be small term or accidental death policies that are just enough to cover final expenses — and that’s it. And because many of these plans are meant to be one-size-fits-all, they don’t always offer certain benefit riders that a supplemental life insurance policy can.

Your employer-sponsored life insurance stays with the desk

Life insurance with an employer-sponsored plan isn’t transferable. So if you leave your company or get laid off, you’ll no longer have coverage and will need to get a policy elsewhere based on your current age and health status. This is a very important reason to consider purchasing your own life insurance policy because no matter where your career takes you, the policy you own outside your job is yours — as long as you continue to make your premium payments.

Know your employer-sponsored life insurance policy

Take the time to meet with your employer benefits representative and find out exactly how much life insurance and what type of policy you have. If the limit isn’t where it should be, ask if it can be increased and if there are any additional policy riders that you can add to enhance your coverage. Better yet, consider purchasing a life insurance policy independent of your job. That will lock in policy rates, provide you with higher limits and more options, and give you a policy that will move with you.

To get more information on types of life insurance, visit our learning center.


1. 2014 Insurance Barometer Study, Life Happens and LIMRA

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This article is a high-level summary of financial considerations and is for information and educational purposes only. It does not necessarily represent the opinion of Protective Life; and, is not intended to serve as financial advice. The article is meant to supplement other information specific to your situation. Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your legal or tax adviser regarding your individual situations before making social security, retirement planning, and tax-related decisions. For information about Protective Life and its products and services, visit www.protective.com.

Employer-Sponsored Life Insurance

Many companies offer group life insurance for their current employees. This can be an excellent benefit, but it is one to fully understand. This article highlights a few considerations when evaluating the pros and cons of depending on an employer-sponsored life insurance policy to meet your coverage needs. For more information, visit our learning center.

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