Don't Rely on Employer Life Insurance Coverage Alone
Fewer employers are offering life insurance to workers as an employee benefit.
Only 48% of employers offered life insurance as an employee perk, as of 2016. This reflects a steady decline of 23% compared to 2006 levels, according to the Life Insurance Marketing and Research Association (LIMRA).
The decline is curious, given that some six in 10 employees rank employer-paid life insurance as an "important" or "very important" part of an employer's benefits package.
Americans are underinsured
Americans are dangerously under-protected when it comes to life insurance. Three in four American households without life insurance report they would have immediate or near-immediate trouble paying for basic living expenses in the event of the death of a primary wage earner.
But relying solely on group life insurance coverage from your employer may not be sufficient. Tax laws limit the deductibility of employer-paid life insurance premiums to those required to provide a death benefit of $50,000, when many American working families need several times that amount of protection.
Even among those who have group life insurance from their employers, half still report they would have immediate or near-immediate hardship in the event of a breadwinner's unexpected death, according to LIMRA figures.
Own your own coverage
Even if employers weren't cutting back on life insurance as an employee benefit, there are many good reasons to contact an insurance agent and take out your own life insurance policy. Here are five of them:
1. It goes where you go. If you leave the firm, you may lose your coverage. If you have a history of health issues, it may be difficult or impossible to get life insurance at that time. If you own your own policy, you don't have to worry about losing your life insurance when you leave the company.
2. More coverage. While employers often limit what they'll pay for to a death benefit of $50,000, or one to two times your salary, this may not be nearly enough. Experts often recommend owning at least 10-20 years' worth of your current income in life insurance protection - particularly for younger families early in their careers.
3. More features. While most workplace life insurance policies are one-size-fits-all, buying your coverage from an agent in the open market means you can customize your insurance policy. For example, you can choose whole life or universal life insurance for permanent life insurance that accumulates cash value.
You can also get coverage to cover your…