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Should I Sign Up For Life Insurance Through Work If I Already Have A Life Insurance Policy?


Life insurance is offered by some employers as part of their group benefits package. Usually, the employer pays for most or all of the premiums. Companies are not required to provide life insurance for their employees. When they do, it is a nice benefit, and you should take advantage of it. If you already have an individual life insurance policy, that is ideal, as group life insurance may not be enough.

It may help to speak with our experienced agent about your life insurance options. We can help you find the best quote for the life insurance coverage you need.

Why Would You Need Both Individual & Group Life Insurance Policies?

Life insurance is a generous addition to a group benefits package, but it may not be enough. Your beneficiaries can only collect group life insurance benefits if the policy is in effect and you are employed with the company at the time you die.

If you were severely injured in an accident or developed a terminal illness, you might be unable to work for a long period leading up to your death. Most companies will terminate your employment and discontinue your benefits if you are unable to work for a certain amount of time. In such a case, you would no longer have life insurance, health insurance, or other benefits previously provided by your employer.

In the event you were able to recover from your injury or illness and return to work after several months, you may end up finding work with another company that does not include life insurance in the group benefits it offers employees. If you shop for life insurance on your own at this point, you now have a pre-existing condition that can significantly increase your rates.

Pros & Cons Of Group Life Insurance

Group Life Insurance Advantages

Group life insurance may be available through your employer at little or no cost. All you have to do is sign up, and in some cases, enrollment is automatic. Employers typically provide basic group life insurance for free. Typical coverage amounts are $25,000, $50,000, or the employee’s annual salary rounded to the nearest $1,000. As this coverage is generally guaranteed, convenient, and free, there is no reason not to accept it.

Group Life Insurance Disadvantages

One of the disadvantages of group life insurance is that most people do not stay with the same employer their entire career. In some cases, you may have the option to convert your group life insurance to individual life insurance, but the cost could increase significantly if you do. Another con is that group life insurance does not offer a wide range of policy options.

If you sign up for group life insurance, you may have the option to purchase supplemental group life insurance, with coverage sometimes up to three or four times your annual salary. The drawback is that, for higher amounts, you may be required to fill out a health questionnaire. If there is any history of serious disease, it could lead to a review of your medical records, a physical exam, medical testing, and ultimately, rejected coverage.

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