Employer-Issued Life Insurance: 4 Questions You Need to Ask Now


| 3 min read

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More Americans than ever before are covered under employer-issued life insurance plans instead of individual ones – 108 million to be exact, according to a new research study by LIMRA. Life insurance helps families prepare for the future and for the financial burdens associated with the loss of a loved one. There are many types of life insurance plans, including supplemental life insurance, so it’s important to be knowledgeable about your options. If life insurance is offered through an employer, here are some questions to consider:

Is my employer-issued life insurance plan enough?

Employer-issued life insurance is a wonderful perk if your company offers it, but – depending on the plan or your personal situation – it may not be enough. Should the unthinkable happen, the basic plan may not be sufficient if you have a spouse or children who depend on your income. Basic life insurance plans range from flat rate to multiples times a person’s annual salary; however, this amount does not take into account bonuses, other benefits or additional income. Experts recommend a life insurance policy that is about 10 times the amount of your annual salary. Supplemental life insurance plans, in addition to your basic employer-issued plan, can help you reach the recommended policy payout to ensure financial stability for your family well into the future. So, be sure to ask if your basic life insurance plan is enough and plan accordingly.

What happens to my plan if I leave my job?

Planning ahead can help you prevent gaps in your life insurance coverage in the event that you change jobs, get laid off or get terminated. Typically, group life insurance plans are only available during your employment; however, some have portability. This means they can be switched over to an individual policy should you find yourself unemployed. Be more prepared for your future by talking with your employer to see If your plan is portable – this will help you feel more financially secure, too.

What happens to my plan if I fall ill or become disabled?

Illnesses and disabilities can happen at any time and, unfortunately, they aren’t always foreseeable. It’s a good idea to ask your employer about the portability of your life insurance plan should you need to leave your job because of an illness or disability. It is also a good idea to see what other plans your employer may offer, such as accident, short-term and long-term disability, critical illness or hospital recovery insurance. These additional insurance options can help ensure you’re able to pay your medical bills, out-of-pocket costs and living expenses during your time out of work.

Can I get life insurance if I am already sick?

If you are already living with an illness or condition, you should find out if your employer-issued life insurance plan offers guaranteed issue options life insurance. With guaranteed issue plans, you will be covered regardless of the state of your health and no medical questions or exams are required. If you would like to know more about life insurance, contact us at SpecialtyBenefits@bcbsm.com. Our team can answer your questions and help you find the right coverage portfolio for your unique needs. You can find additional resources on specialty insurance in these blog posts:
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