Without a doubt, life insurance is valuable protection provided by your employee benefit plan, but should it be the only life insurance coverage you have? Probably not, if you want to ensure you have sufficient long term protection to cover all your family’s financial needs should you die unexpectedly.
In a recent study conducted by the Life Insurance and Market Research Association (LIMRA), it was reported that 61% of Canadians hold some form of life insurance. Surprisingly, it also revealed that only 38% of Canadians own an individual life insurance contract. This means that almost 40% rely solely on the life insurance provided by their employer. This can be problematic. The disadvantages of having your employee benefit plan as your only life insurance protection include the following:
It is probably not enough to pay off your mortgage and/or provide income for your spouse and family.
The amount of life insurance protection provided by group insurance in most cases is equal to only one or two times annual income. If this is not enough to do the job, the addition of individual life insurance should be considered. Read more