Companies that offer health insurance benefits to their employees will also typically offer life insurance policies to cover employees and their immediate family members. Although employees might believe their employer-provided life insurance policy is sufficient for their needs, the reality is that individuals and families benefit from having a diverse life insurance policy portfolio in order to ensure maximum protection if the unthinkable happens. In today's blog post, we explain why employees should not rely solely on their employer-provided life insurance coverage, and why having a supplemental life insurance policy is the most beneficial option for both individuals and families.
You Won't Work There Forever
The biggest problem with only having life insurance coverage for you and your family through your employer is that the life insurance coverage will likely end when your employment does, whether you resign or are terminated. This can create a gap in coverage and leave you and your loved ones without any life insurance coverage. Even if you immediately seek out a new life insurance policy to replace the work-provided coverage, there will be a coverage gap while waiting for the new life insurance to take effect.
Difficulty Getting Coverage Later
When people purchase life insurance through their employer, they typically do so right at the beginning of their employment. However, if the employer-provided life insurance is ever cancelled down the road, it may be more difficult for the individual to purchase supplemental life insurance because of their older age or health issues that have developed since their initial purchase. Additionally, some individuals who lose their employer-based life insurance coverage may find themselves completely uninsurable due to preexisting health conditions, leaving them in a precarious financial situation.
Limits on Coverage Amounts
Another problem that can occur when solely relying on employer-provided life insurance is that the company may impose restrictions on coverage amounts. Limits on life insurance coverage means there might not be enough in policy benefits to cover future needs and financial responsibilities of beneficiaries, such as a mortgage, outstanding debts, medical costs, or college tuition and wedding funds for surviving children. Being underinsured can leave grieving family members and loved ones in a dire financial situation if there is not enough in policy benefits to help offset the sudden loss of income, as well as outstanding debts and expenses.
Employer-Related Claim Delays
Having supplemental life insurance through a separate insurance agency can provide flexibility and more prompt service when it's needed most. Filing life insurance claims and processing paperwork can take even longer for grieving survivors when forced to first go through the employer's HR department. With supplemental life insurance, survivors can work directly with the insurance company to get prompt and thorough assistance during the claims process instead of having to wait on company HR representatives to initiate and process the required documentation.
Life Insurance is never a popular topic for families to discuss, but it is critically important for individuals and families to make good financial decisions and solid plans for the future now instead of waiting until a disaster strikes. Aegis is proud to offer a full range of top quality and reliable life insurance options for individuals and families, all at competitive rates. Whether you need Whole Life Insurance, Term Life Insurance, or Universal Life Insurance coverage, the friendly and knowledgeable team at Aegis can help get you the Life Insurance coverage needed to protect families when it's needed most. Call Aegis today at 713-850-7622 for more information, or go online to request a free quote today!