I already have Term Insurance at Work. Why should I consider taking it outside Work ?

If you are thinking, I’m already covered at Work - Why do I need Term Insurance ?

Read further! Some insights to consider, on the limitations of depending solely on Work based Life Insurance coverage.

1. Inadequate Coverage :

Check the insurance coverage amount you have at your work. It is usually X times your annual compensation. It may not provide you the adequate coverage as high as $1MM or $2MM+ that you may need based on your unique situation.

2. Exposure to Loss of Coverage :

When you are in a situation of being in-between jobs, or starting a job at a new company and there is a cooling off period before the insurance benefits kick in - when you are exposed with no coverage. Or plan to retire early from work. (COBRA does not cover life insurance) (Generally, your life insurance coverage will end when you leave your job or plan to retire early from work. That means you'll need to apply for new coverage independently from a life company based on your current age and health status. This may not seem to be a significant problem, but certain health conditions can make it difficult to find an affordable policy, or even make it impossible to qualify for coverage. For these reasons, it's often a good plan to carry additional life insurance independent of what you have through your employer. That way, the policy you have is yours no matter where you choose to work.)

3. Higher costs due to annual renewable premiums :

You may be paying a tad more than you would be taking it from a private insurer. Do the math, and check how much you are paying per month (not per pay period) at work (& compare it with the monthly quote from a private insurer for same coverage) (Your work based coverage premiums are renewable each year, and it likely increases a bit each year. When taking your own private term insurance, the monthly premiums are set to be the same/locked and guaranteed to be the same for the entire policy duration of 10, 15 or 30 years.)

4. No Living Benefits :

Work based life insurance policies do not have living benefits to cover Critical, Chronic and Terminal Illness where you can accelerate the death benefits while you are living. These are common features/free riders provided with private insurers.

5. Risk of Health deterioration/Un-insurability :

Based on the age bracket you are in, it may be better to take a term insurance NOW, while you are in good health and lock in a set premium for the entire term of 20 or 30 years, before your health condition deteriorates and your premium increases significantly or you are deemed uninsurable. Have a vision of it like Home Insurance, or Auto Insurance, where we don’t think twice-having it, because it is required. This is protecting and taking care of the financial welfare of your family and loved ones. And they don’t have to depend on a #GoFundMe.

The above are pointers to spark your awareness. Reach out to us for further insights or if you have questions.

We are analytically driven and offer our expertise to guide you in alignment with your objectives, risk tolerance and time horizon to structure custom solutions for you. We will provide real-time quotes from multiple insurance carriers for your review & help you in framing them up to decide.

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