Term Life Insurance Articles
Evaluating An Employer Sponsored Life Insurance Policy
2011-09-17
Employer sponsored life insurance is a common job benefit that can be extremely useful and valuable. A well-designed life insurance policy provides great financial protection for workers and their families, and when an employer is paying for a portion of the premiums, it can be a low-cost way to get great peace of mind. However, not every employer sponsored life insurance policy is worth the money. In some cases, workers would be better suited to looking for their own life insurance, and it's important to carefully read through the terms of an employer sponsored life insurance policy before deciding whether or not the policy is worthwhile.
One of the first aspects of a life insurance policy that workers should check is its benefits. Employer sponsored plans often have somewhat restricted benefits, so workers should ensure that the policies provide enough coverage to pay for reasonable costs for beneficiaries (which are usually set as the worker's family members). Some employer sponsored plans offer small benefits which may barely be enough to pay for funeral expenses. This type of life insurance policy may not be worth the money, depending on the worker's other investments and the cost of the policy. On the other hand, some employer sponsored policies allow workers to set their own benefit levels. It's still important to read the terms that establish payout conditions, including exclusions. Workers should also note whether or not an employer sponsored life insurance policy offers double indemnity, which is a special term that pays more than the face value of the policy if the policyholder dies while working. Double indemnity can greatly increase the value of a policy, especially if the policyholder has a fairly risky job. However, it can also increase the cost of the life insurance policy.
It's also important to check the policy's premiums against other options in order to ensure that they're priced fairly. Most employer sponsored policies will be less expensive than non-sponsored policies, as the policyholder's employer is paying for a portion of the premiums. However, sometimes the costs are set high enough initially that premiums are infeasible even with the employer's help. Fortunately, it's easy to check life insurance rates to see whether they're fair. Workers simply need to head online to find a life insurance comparison website and check whether other insurance providers are charging a similar or lower rate for a life insurance policy with similar coverage.
Employer sponsored health insurance can be a great purchase and can provide a great value for some workers. However, all workers should read through a policy and check its rates before opting in.
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Employer sponsored life insurance is a common job benefit that can be extremely useful and valuable. A well-designed life insurance policy provides great financial protection for workers and their families, and when an employer is paying for a portion of the premiums, it can be a low-cost way to get great peace of mind. However, not every employer sponsored life insurance policy is worth the money. In some cases, workers would be better suited to looking for their own life insurance, and it's important to carefully read through the terms of an employer sponsored life insurance policy before deciding whether or not the policy is worthwhile.
One of the first aspects of a life insurance policy that workers should check is its benefits. Employer sponsored plans often have somewhat restricted benefits, so workers should ensure that the policies provide enough coverage to pay for reasonable costs for beneficiaries (which are usually set as the worker's family members). Some employer sponsored plans offer small benefits which may barely be enough to pay for funeral expenses. This type of life insurance policy may not be worth the money, depending on the worker's other investments and the cost of the policy. On the other hand, some employer sponsored policies allow workers to set their own benefit levels. It's still important to read the terms that establish payout conditions, including exclusions. Workers should also note whether or not an employer sponsored life insurance policy offers double indemnity, which is a special term that pays more than the face value of the policy if the policyholder dies while working. Double indemnity can greatly increase the value of a policy, especially if the policyholder has a fairly risky job. However, it can also increase the cost of the life insurance policy.
It's also important to check the policy's premiums against other options in order to ensure that they're priced fairly. Most employer sponsored policies will be less expensive than non-sponsored policies, as the policyholder's employer is paying for a portion of the premiums. However, sometimes the costs are set high enough initially that premiums are infeasible even with the employer's help. Fortunately, it's easy to check life insurance rates to see whether they're fair. Workers simply need to head online to find a life insurance comparison website and check whether other insurance providers are charging a similar or lower rate for a life insurance policy with similar coverage.
Employer sponsored health insurance can be a great purchase and can provide a great value for some workers. However, all workers should read through a policy and check its rates before opting in.
