Is Life Insurance Through Work Enough?

Mother, daughter and father at home

Your employer’s life insurance policy can serve as a valuable safety net if something were to happen to you. If you already have this benefit at work, you're taking an important step to protect your family.

But do you know what type of life insurance coverage you have? Is it enough? Is it even the most affordable option for you? What would happen to your life insurance if you lost your job?

Group life insurance through work can be a valuable benefit, but the policy is only effective as long as you're employed there. Plus, the coverage is typically designed to accommodate all employees – and life insurance is definitely not “one size fits all.”

That's where your local financial advisor comes in. By looking at your family's situation and needs, and using our tools and resources, we can come up with options that make the most sense for you.

The Average Employer Plan Provides $85,292 Worth of Coverage.* Will That Be Enough for Your Family?

Consider this example:
A family receives an $85,292 payout from an employer plan.

$85,292
- $10,000 funeral expenses
- $8,000 debt
= $67,292 left over

Assuming the family invested that $67,292 and earned a 5% rate of return, they would only have $3,365 in income a year to live on. If the family normally relied on $85,292 a year, that's a gap of $81,927 that would need to be filled each and every year -- or hundreds of thousands of dollars over a lifetime.

Another factor to consider is that unlike an individually purchased policy, group life insurance does not guarantee insurability. If you become seriously ill, you could find yourself uninsurable once you eventually recover. This means that when you need life insurance most, you may not even be able to purchase it.

How Do You Know if You Have the Coverage You Need?

That's where your local financial advisor comes in. By looking at your family's situation and needs, and using our tools and resources, we can come up with options that make sense for you. We'll use L-I-F-E to calculate your needs:

  • Liabilities: Will your family need money to pay off a mortgage, car or other debt?
  • Income: Will your spouse need additional income?
  • Final Expenses: Do you have the cash available to cover them?
  • Education Needs: Do you need to put your children through college?

How We Can Help

Before you simply “check the box” for your employer’s life insurance, talk to your local financial advisor. We can look at your entire financial situation and help you tailor your life insurance to your life.

Important Information:

*GenRe 2015 U.S. Group Term Life Market Survey

Edward Jones operates as an insurance producer in California, New Mexico, and Massachusetts through the following subsidiaries, respectively: Edward Jones Insurance Agency of California, L.L.C., Edward Jones Insurance Agency of New Mexico, L.L.C., and Edward Jones Insurance Agency of Massachusetts, L.L.C.

More Resources:

Your Guide to Choosing Life Insurance

Perm or term: Which type of life insurance is right for you?

Do you have a short-term insurance need?

Term life insurance might be a better option.

When is perm better than term?

For life insurance needs of 20 years or more, permanent insurance may be a better option.

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