Supplemental life insurance through work


#1

Is getting supplemental life insurance through work worth it? If so, how much? It’s very cheap, but it’s hard to know if they’re actually selling something worthwhile. My company automatically enrolls us at 1x base salary, but we can increase that by multiples up to $750,000 total during open enrollment (which is late April/early May of each year). The idea of leaving behind huge sums of money in case I die unexpectedly is quite nice, but I don’t even know what the term of the policy is, and if it goes away if I leave my job. Any advice?


#2

Is it cheaper than seeking life insurance not through your work? The policy may be directly with the insurer and your company just covers part of the cost, meaning you can pay the full cost directly to the insurer if you leave your job but you should check this before you sign anything. It’s a normal question they should be happy to answer quickly.

How much insurance to have on yourself is a really individual question. How much do the people that would be receiving the benefit need? Nothing will replace you, but replacing your income for a year, three years, five years, will help them. If you’re close to FIRE then you’re less likely to need life insurance.

Also it’s worth making sure you have a will in place too along with an advanced directive and healthcare POA, if you’re starting to look at end of life stuff. Talk to your family members about what you want - this is a good resource to figure out how to start talking about it.


#3

If you wanted life insurance anyway and it’s cheaper through work than some other way, then it is very likely a good way to get some for low cost. Usually but not always you lose access to these policies when you leave the job in question. Sometimes you can keep them. So that’s worth asking.