To help, we highlighted the basic differences between your life insurance options as well as included the pros and cons of each.
First things first. Always take advantage of basic group coverage. This is either paid by your employer or very inexpensive.
However, your basic group coverage is rarely enough. Typically, this amount is for one or two times your salary up to a certain maximum, often $50,000. To adequately secure your family’s financial future, you need more life insurance coverage.
How to get the right amount of coverage
These are two common ways to supplement your group coverage:
- Buy additional coverage called voluntary life insurance through work
- Purchase your own individual term life insurance policy
There are three very important things you need to know about these options.
Voluntary life insurance (through work):
- Rates continually go up, especially after 40
- Coverage is contingent on employment
- Coverage amount is limited (it still may not be enough)
Individual term life insurance:
- Rates are locked and won’t increase
- Coverage follows you from job to job
- Coverage can be customized to fit your needs and budget
For a more detailed understanding of your life insurance options, here are the pros and cons of basic group life insurance, voluntary life insurance, and individual term life insurance.
|Type of Life Insurance||Pros||Cons|
|Group Life Insurance Policy||
|Voluntary Life Insurance Policy||
|Individual Term Life Insurance Policy||
If you want the right amount of coverage that stays with you and has a rate that won’t increase, an individual term life insurance policy will fit your needs perfectly.
You don’t need to choose either/or. You can keep your group coverage through work and still own an individual term life insurance policy.
If you’d like more information about this, check out our guide on buying life insurance during open enrollment.
Ready to see what you’d pay for term life insurance?
Take our quoting tool below for a test drive.
About the writer
Director of Creative Strategy
Greg is Quotacy’s Director of Creative Strategy. He has an eclectic past from working on movie scripts to creating ad campaigns for major brands. His love of creative solutions drove him to strategy, and he now uses his powers to help families protect their loved ones. Outside of work, Greg spends his time off the grid hunting, fishing, camping, biking, hiking, and walking his dogs.