supplemental life

Individual Life Insurance for Employees

What You Need to Know

  • Your clients could lose the ability to work, or die.
  • Some insurance is better than none.
  • Enough coverage beats some coverage.

Since the pandemic, more companies have started to offer health insurance and group life insurance than ever before.

Still, more than 100 million individuals in the United States don’t have sufficient coverage to provide their families with financial security in case of a tragedy, according to the 2022 Insurance Barometer Study by LIMRA and Life Happens.

One of the main barriers to financial security is the low coverage that basic group life insurance policies provide.

If businesses want to help their employees — your clients — achieve financial security, they must go beyond the benefits offered through standard group life coverage.

Here’s what you need to know about the way companies offer your clients life insurance now and how that could change in the future.

Life Insurance Today

When employers started offering group life insurance policies, many workers who wouldn’t otherwise have access to life insurance suddenly had coverage, however limited.

Group insurance policies are attractive because their approval by an insurer is virtually guaranteed.

Some of the main features of group life insurance include that client companies usually need to renew group insurance policies year by year or every five years.

The premiums are low, so group life insurance is affordable for most companies.

Coverage is usually fixed rather than based on the individual’s health.

Some basic policies provide minimal coverage for a spouse and children, or employees can purchase supplemental insurance for better coverage.

Unfortunately, there are some downsides to group life insurance.

First, group insurance isn’t portable if an employee changes jobs, because the business owns the policy.

This means that some employees who resign or lose their jobs are

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