Fortunately, after you receive group life insurance through your employer, you never have to worry about policies again.
Not so fast.
As a life insurance company Ethos points out, this group policy might only cover one to two times your annual salary. According to financial experts, you should have a life insurance policy representing 10 to 12 times your annual income. That’s a lot of potential bills, debts, and living expenses that could go unpaid. That’s why companies like Ethos aim to offer life insurance that’s both easy to purchase and customizable to your personal needs.
Ethos offers two types of policies: term insurance and whole life insurance, which can be combined with your workplace group life insurance for optimal coverage.
Term vs Whole vs Group Life Insurance
Term life insurance provides coverage for a set period of time, so if you die during that time, your beneficiaries receive a death benefit (cash payment). This is usually for people who want the most affordable coverage, need temporary additional coverage, or have other short-term responsibilities.
Whole life insurance provides coverage that lasts the rest of your life and can also be used as an investment vehicle. Because of these characteristics, whole life insurance policies are generally more expensive than term life insurance policies, costing 5 to 15 times more for the same amount of coverage. Whole life policies may be a better option for those who want coverage for the rest of their life or a policy that increases cash value over time to supplement retirement income.
Group life insurance places your policy in the hands of your employer, who is essentially the “owner” of the policy. It works like an individual term insurance policy in that you pay monthly premiums to ensure your coverage. However, there are a few drawbacks. As you age, your premium may increase and coverage may be limited as employers also try to provide other benefits (like health insurance).
While it may seem convenient, easy and affordable to get this at your workplace, it’s important to consider supplemental insurance to fill in the gaps that group policies can leave behind. One way to buy new life insurance is to get a personalized quote from Ethos that can help guide you towards better and more balanced coverage.
Ethos’ fully online application process can even lead to same-day coverage, allowing most users to avoid the often tedious medical exams required for life insurance.
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