Most of the companies offer benefits upon hiring to make the company more attractive for employees. In the list of benefits you get upon employment there is a life insurance – which is certainly a good idea. And although it is a great offer for a company worker, there are reasons why you should purchase your own life insurance additionally. However, let’s begin with considering employer’s life insurance benefits at first.
Benefits of Employer’s Life Insurance
So below is the list of benefits:
- Insurance is subsidized – which means you pay less for life insurance as the part of expenses are compensated by the company and due to the fact the insurance is designed for a group of people the starting cost for it is much lower.
- Easy to get – you do not need to undergo the standard qualification for life insurance if provided by employer, so if you have any diseases or other factors that increase cost or make it harder to get life insurance, you benefit much from employer’s life insurance.
- Optimal – usually employer’s life insurance is optimal and you surely know you can afford it; you do not have to do a thing to get insurance as your payments are deducted from your salary.
So you get as much as possible provided by your employer. However, due to the insurance being a group one it may not answer your needs and here is when we go to the reasons to purchase insurance on your own.
Why to Buy a Life Insurance?
The main reason why most of us choose life insurance is the fact we want to be sure our relatives will be financially secured upon our death. So it is up to us to choose the sum of compensation and the term of insurance. So below are the reasons to purchase insurance:
- You can lose the job – and thus you will lose the coverage with all the payments you have made – this is a very bad situation as you won’t be able to get compensated.
- Employer can change the terms – and all the workers who are paying for insurance counting you will get worse terms both for compensation and monthly payments.
- Insurance terms may encounter your financial, job status or even age – for example when you reach 40 years barrier the coverage may be terminated.
- There are no alternative options available – if you need to combine it with medical insurance or increase the coverage you won’t be able to do that as the contract is being signed between your employer and insurer.
All of the mentioned above make employer’s insurance look not so attractive. Although it is still a good idea, it is always better to rely on your own insurance which can be fully adjustable.
Risks of Taking Your Own Life Insurance
However, when you take a life insurance on your own there is always a risk you won’t be able to pay for it. And this is a critical moment as for some insurance programs even if you miss one or two payments your coverage can be terminated which leads to enormous losses concluding monthly payments made and compensation your family will lose. So you have to choose wisely the program and make sure you have funds on your bank account on the moment of payment date.
And one more thing – you can get reject upon application. Why? Well, the reason is that whether you will get life insurance and its terms depend highly on your credit history, age, occupation, monthly income and health. If one of those doesn’t comply company’s requirements you won’t get insured.
Benefits of Taking Your Own Life Insurance
So the benefits are:
- it is fully adjustable – you can negotiate the terms with insurer;
- many options and companies available – you are free to choose from any company operating in your area;
- coverage guaranteed – if terms weren’t violated you will definitely get a coverage.
When dealing with life insurance you should always keep in mind the main goal of acquiring it – financial aid to your family upon your death and then it will be much easier to make decisions. If you are going to choose life insurance take a look at our article disclosing the difference between whole and term life insurance.