Is Employer-Provided Life Insurance Coverage Enough?

To attract and retain the best talent, firms offer additional benefits to their employees. One of these benefits is life insurancecoverage. Employer-sponsored insurance plans can be low-cost, or sometimes even free. They are always easier to procure – the employer often takes care of the technicalities. However, employer-provided life insurance plans are only sufficient for a small subsection of the population.

If you are young and single, then an employer-provided plan may be enough. But if you have a partner, old parents, and especially if you have children, then your safety net needs to be a lot stronger. Here are some reasons why one must obtain insurance beyond their workplace-sponsored plan:

• One may lose their job – or want to quit. There are two scenarios here – either one getsbooted or decide that their current company isn’t the best fit. In the former scenario, if one only has an Employer-Provided Life Insurance plan, then they will not only lose their job, but also lose their safety net. Let’s consider the second scenario. Even if the employee feels that they are unable to reach their full potential in their current job, the prospect of losing their life insurance coverage might keep the employee stuck in an unfulfilling position. Therefore, an individual life insurance policy provides protection regardless of the employee’s career moves.
• The firm might pull back the coverage. Most firms go through a purse-tightening phase at one point. They either lay off some employees – for instance, Zomato recently automated its customer support system and cut out 540 manual jobs – or they cut back on employee benefits. This is where one’s life insurance plan might come under the axe. A change in management – or a shuffling of the Board – might result in one’s insurance not getting renewed at the end of the year. Life Insurance must be consistent and reliable – and employer-based plans are dependent on too many variables.
• Life Insurance gets more expensive as you age. You may have decided to buy life insurance for yourself later in life, once your employer-sponsored coverage subsides. However, life insurance gets more expensive for older people, owing to the increased risk of mortality. The value-to-cost ratio for life insurance is more feasible if you buy it sooner.

Thus, employees should build their own safety net today. NBC has reported than “job-hopping is on the rise,” and Monster has written than changing jobs regularly – though not too often – can help you bump up your salary significantly. Therefore, untie your insurance from workplace turbulence and career mobility today.

One can easily explore Aegon Life’s Term Insurance plan for a policy that suits their needs perfectly.  The iTerm plan provided by Aegon Life provides comprehensive coverage up to 100 years of age. The iTerm Insurance plan also offers three different plan variants: Life Protect, Protect Plus, and Dual Protect. Dual Protect offers a monthly income to policyholders while Protect Plus raises the life cover by 5% every year – while the premiums stay the same! The iTerm plan also offers lower premiums for females and non-smokers.