Life insurance through employer vs external
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Life insurance through employer vs external
Hi all,
We would like to get some life insurance that goes beyond the typical "free benifit" one gets from their employer. I get 2.5x free benifit. We really would like to get additional insurance. I can get a 1.6M policy through work for $60 per month. This seems pretty decent rate but our worry is other than sudden natural death, what if one of us gets terminally ill, then our company asks us to "leave" or say there is illness and at the same time we lose our job then getting covered externally would not be possible as that same illness would become pre existent condition and therefore denied being covererd?
What are your thoughts, how does the community approach it. I am not sure how much it would cost for a similar 1.6M policy externally .. I imagine a lot more than $60/month. I tried to go through policy genius but they are asking for a lot of private data and I am not yet ready to give that out without knowing which way we should go. Stay with our employer or go external. Our company uses METLIFE btw.
Thank you!
We would like to get some life insurance that goes beyond the typical "free benifit" one gets from their employer. I get 2.5x free benifit. We really would like to get additional insurance. I can get a 1.6M policy through work for $60 per month. This seems pretty decent rate but our worry is other than sudden natural death, what if one of us gets terminally ill, then our company asks us to "leave" or say there is illness and at the same time we lose our job then getting covered externally would not be possible as that same illness would become pre existent condition and therefore denied being covererd?
What are your thoughts, how does the community approach it. I am not sure how much it would cost for a similar 1.6M policy externally .. I imagine a lot more than $60/month. I tried to go through policy genius but they are asking for a lot of private data and I am not yet ready to give that out without knowing which way we should go. Stay with our employer or go external. Our company uses METLIFE btw.
Thank you!
Re: Life insurance through employer vs external
OP,
"It depends"
A) What is your portfolio size versus your current annual expense? 1X? 5X? 10X?
B) What is your saving rate in terms of your current annual expense? 50%? 100%?
I only get free life insurance from my employer. With my portfolio size (30X) and annual saving rate (100%), it does not make any sense to get more or do anything else.
C) This depends on your age too. At a younger age, disability and unemployment is a larger danger/liability than death. Life insurance does not cover that.
KlangFool
"It depends"
A) What is your portfolio size versus your current annual expense? 1X? 5X? 10X?
B) What is your saving rate in terms of your current annual expense? 50%? 100%?
I only get free life insurance from my employer. With my portfolio size (30X) and annual saving rate (100%), it does not make any sense to get more or do anything else.
C) This depends on your age too. At a younger age, disability and unemployment is a larger danger/liability than death. Life insurance does not cover that.
KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
Re: Life insurance through employer vs external
Yes, absolutely. Get external insurance while your health is good. My husband had a company policy through his airline union. The union was disbanded and replaced with a different union.He then had to shop for insurance but by then his health record had something in it which really jacked up the rate.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 8:33 am Hi all,
We would like to get some life insurance that goes beyond the typical "free benifit" one gets from their employer. I get 2.5x free benifit. We really would like to get additional insurance. I can get a 1.6M policy through work for $60 per month. This seems pretty decent rate but our worry is other than sudden natural death, what if one of us gets terminally ill, then our company asks us to "leave" or say there is illness and at the same time we lose our job then getting covered externally would not be possible as that same illness would become pre existent condition and therefore denied being covererd?
What are your thoughts, how does the community approach it. I am not sure how much it would cost for a similar 1.6M policy externally .. I imagine a lot more than $60/month. I tried to go through policy genius but they are asking for a lot of private data and I am not yet ready to give that out without knowing which way we should go. Stay with our employer or go external. Our company uses METLIFE btw.
Thank you!
Get your own policy while young and healthy and keep it going.
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Re: Life insurance through employer vs external
Hi Klangfool,
1. our portfolio is about 15x (2.2M/160k) hope i did that right
2. at our current income we target saving 120k/yr but some years it sometimes goes down to 80k.
3. Agree, and I have A&D through our companies which we get some free benifits and we additionally tag on. I have roughly 1.2M through our employer. My wife gets a seperate coverage through hers but I cant remember what that is. Probably something similar or slightly less.
Thanks
1. our portfolio is about 15x (2.2M/160k) hope i did that right
2. at our current income we target saving 120k/yr but some years it sometimes goes down to 80k.
3. Agree, and I have A&D through our companies which we get some free benifits and we additionally tag on. I have roughly 1.2M through our employer. My wife gets a seperate coverage through hers but I cant remember what that is. Probably something similar or slightly less.
Thanks
Re: Life insurance through employer vs external
If you can't take your employer policy elsewhere, I'd get an external term policy.
In addition to your portfolio size, you should figure out what your spouse would really need after you've gone. If the spouse is not into DIY investing and exploring all the issues often discussed on BH, you probably should have a policy that provides the surviving spouse enough margin for error to still be OK.
In addition to your portfolio size, you should figure out what your spouse would really need after you've gone. If the spouse is not into DIY investing and exploring all the issues often discussed on BH, you probably should have a policy that provides the surviving spouse enough margin for error to still be OK.
Re: Life insurance through employer vs external
You outline exactly one of the major concerns with relying on life insurance acquired through an employer. That is, the insurance ends when your employment ends. And there’s no guarantee that your next employer will offer the same terms for life insurance.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 8:33 am Hi all,
We would like to get some life insurance that goes beyond the typical "free benifit" one gets from their employer. I get 2.5x free benifit. We really would like to get additional insurance. I can get a 1.6M policy through work for $60 per month. This seems pretty decent rate but our worry is other than sudden natural death, what if one of us gets terminally ill, then our company asks us to "leave" or say there is illness and at the same time we lose our job then getting covered externally would not be possible as that same illness would become pre existent condition and therefore denied being covererd?
What are your thoughts, how does the community approach it. I am not sure how much it would cost for a similar 1.6M policy externally .. I imagine a lot more than $60/month. I tried to go through policy genius but they are asking for a lot of private data and I am not yet ready to give that out without knowing which way we should go. Stay with our employer or go external. Our company uses METLIFE btw.
Thank you!
I’d suggest that you go to either term4sale.com or Zander.com to get a free, no obligation, indication of the price that you’d pay. Those sites don’t ask for any intrusive personal information at the early stage of the process.
I can’t judge whether the premium rate from your employer is an attractive rate for you. But, I’d encourage you to find out how the rates for the employer provided insurance will increase as you age. You need to know that so you can objectively compare the price to the cost of an individual policy, which is typically guaranteed and level for 10-30 years.
Unless your employer is offering you an INCREDIBLY attractive rate, I’d go with the individual policy while keeping the 2.5x salary of “free” employer life insurance. And even then I’d lean toward the individual policy.
Retired life insurance company financial executive who sincerely believes that ”It’s a GREAT day to be alive!”
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Re: Life insurance through employer vs external
This is exactly what happened to my father in law. He got sick with a terminal illness, his employer shutdown and moved over seas, he could no longer get life insurance due to the terminal diagnosis.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 8:33 am Hi all,
what if one of us gets terminally ill, then our company asks us to "leave" or say there is illness and at the same time we lose our job then getting covered externally would not be possible as that same illness would become pre existent condition and therefore denied being covererd?
Thank you!
Highly recommend term life insurance outside of your employer.
"They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety." - Benjamin Franklin
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Re: Life insurance through employer vs external
Hi Tdubs, could you please elaborate on what you mean here?
Do you mean establish a relationship with a CFA or have insurance policy listed in the will..? Sorry I wasnt clear
Re: Life insurance through employer vs external
Just picking up on Klangfool's comment that he is at 30x and saving a lot. In my situation, my spouse will not ride herd on our portfolio as I do nor will she be in a position to save a lot if I die tomorrow. I have a very small insurance policy for her, but I have a much larger one for myself. She needs some latitude to make mistakes and get, as you say, an advisor, accountant, etc.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 9:57 am Hi Tdubs, could you please elaborate on what you mean here?
Do you mean establish a relationship with a CFA or have insurance policy listed in the will..? Sorry I wasnt clear
Re: Life insurance through employer vs external
if you use the search bar up at the top right of the screen you can find plenty of previous discussions that will give you a range of opinions.
This is probably different than buying your own policy since the rates will go up annually with your age but you can buy your own policy with a fixed yearly price. Two other considerations are that you may not be with this employer forever (voluntarily or involuntarily) and also each year benefits are subject to change and even if you still work there it may be dropped.I can get a 1.6M policy through work for $60 per month.
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Re: Life insurance through employer vs external
A bit different topic to ponder over but thanks so much for this tip. We have a revocable trust, a will etc but I do not think she will remember everything since she prioritizes taking care of different aspect of our life and isnt always thinking about our financial setup. Although she does earn more than me, fortunately
Anyways, If I may, how have you set your wife up that perhaps allows her that lattitude as you say. Any tips would be benificial and I will run those down through my research.
So far it seems like I will opt for external life insurance policy perhaps around 2M for both of us each for the next 20 years.
Anyways, If I may, how have you set your wife up that perhaps allows her that lattitude as you say. Any tips would be benificial and I will run those down through my research.
So far it seems like I will opt for external life insurance policy perhaps around 2M for both of us each for the next 20 years.
Tdubs wrote: ↑Wed Oct 30, 2024 10:48 amJust picking up on Klangfool's comment that he is at 30x and saving a lot. In my situation, my spouse will not ride herd on our portfolio as I do nor will she be in a position to save a lot if I die tomorrow. I have a very small insurance policy for her, but I have a much larger one for myself. She needs some latitude to make mistakes and get, as you say, an advisor, accountant, etc.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 9:57 am Hi Tdubs, could you please elaborate on what you mean here?
Do you mean establish a relationship with a CFA or have insurance policy listed in the will..? Sorry I wasnt clear
Re: Life insurance through employer vs external
It sounds like you have plenty of money already, so why do you need life insurance? If one of you died, would it be a big financial hardship for the other?AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 9:07 am Hi Klangfool,
1. our portfolio is about 15x (2.2M/160k) hope i did that right
2. at our current income we target saving 120k/yr but some years it sometimes goes down to 80k.
3. Agree, and I have A&D through our companies which we get some free benifits and we additionally tag on. I have roughly 1.2M through our employer. My wife gets a seperate coverage through hers but I cant remember what that is. Probably something similar or slightly less.
Thanks
I bought 20-year term life insurance when my first child was born, so if I died my wife would at least be able to keep the house until the kids were grown. Now that they are almost grown, we are not going to renew when the term is up.
Re: Life insurance through employer vs external
This thread made me look at my work policy. I pay about$100/mo for 8x. The cost to convert that to individual policy was $28,510 annual premium. It converts to whole life. Can do term but value is limited to about 1/3 current benefit at 2.5x the current rate. Time for me to start shopping around. I hate this industry though. It’s so difficult to get quotes online and the want to funnel me to some slimy financial advisor.
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Re: Life insurance through employer vs external
Exactly what I am experiencing. They want my cell number to verify my information!!klebs01 wrote: ↑Wed Oct 30, 2024 12:34 pm This thread made me look at my work policy. I pay about$100/mo for 8x. The cost to convert that to individual policy was $28,510 annual premium. It converts to whole life. Can do term but value is limited to about 1/3 current benefit at 2.5x the current rate. Time for me to start shopping around. I hate this industry though. It’s so difficult to get quotes online and the want to funnel me to some slimy financial advisor.
Anyways did you say to get the same 8x that you get for $1200/year from the employer is 28k/year via a extern policy?
Re: Life insurance through employer vs external
Nothing requires you to put in a correct cell phone number on the Zander website. Or a correct email address.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 12:37 pmThey want my cell number to verify my information!
You’ll get a term quote online even with made up cell number and email. No human contact needed.
Retired life insurance company financial executive who sincerely believes that ”It’s a GREAT day to be alive!”
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Re: Life insurance through employer vs external
Thanks will do. Appreciate it.Stinky wrote: ↑Wed Oct 30, 2024 12:40 pmNothing requires you to put in a correct cell phone number on the Zander website. Or a correct email address.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 12:37 pmThey want my cell number to verify my information!
You’ll get a term quote online even with made up cell number and email. No human contact needed.
Re: Life insurance through employer vs external
I bought through Zander.com years ago. Painless process. And they aren’t “slimy”.
Retired life insurance company financial executive who sincerely believes that ”It’s a GREAT day to be alive!”
Re: Life insurance through employer vs external
If you are in good enough health to qualify for that extra coverage from your employer, you should be in good enough health to get a policy for similar or lower cost on the individual market. That will be a policy that you own with no strings tied to your employer, while you'd lose the employer coverage when you leave the job. Worst case scenario is leaving your job after you've developed a health issue causing you to be uninsurable, then your only options are converting it or taking what a new employer offers on a guaranteed basis.
Most group life insurance policies have a "guaranteed issue" amount that's much lower than the maximum allowed, and then if you want additional coverage you have to show proof of insurability/good health. I would bet the guaranteed issue amount is somewhere between $100-500k but only your employer can tell you that.
A term policy purchased on your own will also have a fixed rate for 10-30 years while the group policy will continue increasing premiums every time you hit a 5 year age band (35, 40, 45, etc). So you have to look at the total cost over time, not just what the cost is today.
You're also at the mercy of your employer offering this coverage. What happens if the employer gets bought out and the new company taking over doesn't offer any life insurance or a much lower amount and now you have one of those health issues that would cost a lot more to insure or make you uninsurable?
Most group life insurance policies have a "guaranteed issue" amount that's much lower than the maximum allowed, and then if you want additional coverage you have to show proof of insurability/good health. I would bet the guaranteed issue amount is somewhere between $100-500k but only your employer can tell you that.
A term policy purchased on your own will also have a fixed rate for 10-30 years while the group policy will continue increasing premiums every time you hit a 5 year age band (35, 40, 45, etc). So you have to look at the total cost over time, not just what the cost is today.
You're also at the mercy of your employer offering this coverage. What happens if the employer gets bought out and the new company taking over doesn't offer any life insurance or a much lower amount and now you have one of those health issues that would cost a lot more to insure or make you uninsurable?
Re: Life insurance through employer vs external
After I retired, I found my workplace plan was really out to screw me. When I talked with them before retiring, they said it can be converted to private pay. When I retired they said same thing, no new rate had not yet been set, and that I was just wait for them to send the bill. No bill at 6 weeks, so I called, and was told billing typically is not sent until 4+ months, so just wait for it.klebs01 wrote: ↑Wed Oct 30, 2024 12:34 pm This thread made me look at my work policy. I pay about$100/mo for 8x. The cost to convert that to individual policy was $28,510 annual premium. It converts to whole life. Can do term but value is limited to about 1/3 current benefit at 2.5x the current rate. Time for me to start shopping around. I hate this industry though. It’s so difficult to get quotes online and the want to funnel me to some slimy financial advisor.
Well, when the bill arrived it was for 5 months, 4 past and 1 future, and the rate was near 8x what I had been paying. When I didn't pay, the took the cash balance and applied it towards the premium, which did not quite cover the 4 month's it was in arrears.
It was all a gimmick to use up the cash balance expecting me to cancel the insurance. If I had proactively cancelled the insurance the day I retired, they would have had to send me the cash balance.
Re: Life insurance through employer vs external
Same policy/provider at 8x to convert from group policy to individual policy premium would go from $1200 per year to $28k per year. Crazy. But it converts from group term to whole life. The jump eliminates conversion from being a viable option.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 12:37 pmExactly what I am experiencing. They want my cell number to verify my information!!klebs01 wrote: ↑Wed Oct 30, 2024 12:34 pm This thread made me look at my work policy. I pay about$100/mo for 8x. The cost to convert that to individual policy was $28,510 annual premium. It converts to whole life. Can do term but value is limited to about 1/3 current benefit at 2.5x the current rate. Time for me to start shopping around. I hate this industry though. It’s so difficult to get quotes online and the want to funnel me to some slimy financial advisor.
Anyways did you say to get the same 8x that you get for $1200/year from the employer is 28k/year via a extern policy?
Re: Life insurance through employer vs external
The insurance companies recognize that the vast majority of folks who convert their group insurance into individual policies are those who still need life insurance coverage, but can’t medically qualify for a “good” individual rate.
So they sell you crappy whole life policies with jacked up premiums as “conversion” products. The jacked up rates reflect the expected high mortality rates, since anybody with a brain would buy a regular individual policy if they could qualify.
If you still need insurance coverage after you leave your job and can qualify for an individual policy, you’ll be far better served to buy that policy rather than the conversion policy.
Retired life insurance company financial executive who sincerely believes that ”It’s a GREAT day to be alive!”
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Re: Life insurance through employer vs external
Thanks for the tip. Quite a few options in the $160/mo range for 2M 20 yr policy at zanders. This compared to my employers which was 1.2M for 1yr at 60/mo which anyways is a no go for all the above reasons.Stinky wrote: ↑Wed Oct 30, 2024 12:40 pmNothing requires you to put in a correct cell phone number on the Zander website. Or a correct email address.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 12:37 pmThey want my cell number to verify my information!
You’ll get a term quote online even with made up cell number and email. No human contact needed.
Re: Life insurance through employer vs external
I expect that your $60 per month rate for your group life insurance would go up A LOT during the next 20 years…..AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 2:12 pmThanks for the tip. Quite a few options in the $160/mo range for 2M 20 yr policy at zanders. This compared to my employers which was 1.2M for 1yr at 60/mo which anyways is a no go for all the above reasons.
Retired life insurance company financial executive who sincerely believes that ”It’s a GREAT day to be alive!”
Re: Life insurance through employer vs external
Some pros of using an external insurance provider.
Rate is locked in for duration of term.
Not taxable
If you are healthy, you can get a good rate that won't change if your health changes during the locked in term.
Portable
Rate is locked in for duration of term.
Not taxable
If you are healthy, you can get a good rate that won't change if your health changes during the locked in term.
Portable
The question isn't at what age I want to retire, it's at what income. |
- George Foreman
Re: Life insurance through employer vs external
How did you come up with the $1.6M figure? That may well be right, or not. I am a longtime Maxifi user and while some will inevitably disagree, I've always found their life insurance recommendations were a good fit for us. As our wealth increased and we got closer to retirement, the amount they recommended continued to drop until it reached zero - as it should in many cases, in part depending on your legacy goals (beyond the needs of your spouse). It might be helpful to see a projection of how much insurance you might need and for how long you might need it.
I imagine other retirement planning platforms provide similar info.
I imagine other retirement planning platforms provide similar info.
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Re: Life insurance through employer vs external
Hi that 1.6 number was just the max the company offered in my profile. Someone said premiums are non taxable above? What does that mean or how does that work? Or may be they didn't mean premiums but something else?
Re: Life insurance through employer vs external
Agree with others, you would be better served with a standalone policy vs buying through your employer. I recently compared rates and it was significantly cheaper to just buy term on my own vs buying through my employer. I think the employer policies assume more adverse selection as they know some employees will take the guaranteed issue amount if they have adverse health conditions.
I'd suggest checking out costco's term life offering (through Protective) and Policy Genius. Policy genius referred me to Pacific Life which approved me for 30 year term at $2,000,0000 for $151/month without any doctor visit. Costco's was a little cheaper than that but it did require a medical visit. I took the Pacific Life for now and also signed up for the medical exam through Costco and will see if their rate is real and may cancel Pacific Life. For reference, I'm 37 year old non-smoking male.
Good luck!
I'd suggest checking out costco's term life offering (through Protective) and Policy Genius. Policy genius referred me to Pacific Life which approved me for 30 year term at $2,000,0000 for $151/month without any doctor visit. Costco's was a little cheaper than that but it did require a medical visit. I took the Pacific Life for now and also signed up for the medical exam through Costco and will see if their rate is real and may cancel Pacific Life. For reference, I'm 37 year old non-smoking male.
Good luck!
Re: Life insurance through employer vs external
I think that the reference was that life insurance death benefits do not generate taxable income for the recipient, whether those benefits arise from an individual life policy or employer provided coverage.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 8:08 pm Someone said premiums are non taxable above? What does that mean or how does that work? Or may be they didn't mean premiums but something else?
Life insurance premiums are typically not a deductible expense.
Retired life insurance company financial executive who sincerely believes that ”It’s a GREAT day to be alive!”
Re: Life insurance through employer vs external
I see. It seems like it would be wise to determine how much insurance you actually need - it could be more or less. Of course at a certain point, getting more coverage from a standalone policy could become incrementally more expensive and/or be subject to more onerous underwriting.AvocadoDeliberator wrote: ↑Wed Oct 30, 2024 8:08 pm Hi that 1.6 number was just the max the company offered in my profile. Someone said premiums are non taxable above?
FWIW, I ended up dropping my additional employer insurance in my mid-late 40s because it started to become significantly more expensive. When I signed up it was a no-brainer minor expense, but the rate increases grew exponentially over the years. Fortunately by then my free employer coverage was at least close to all that I needed. Of course my spouse worked and would have continued to do so if I had passed.
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Re: Life insurance through employer vs external
My experience with employer insurance was good, I guess, I never used it, thankfully However, Its key to understand if it is portable. I got 6 times my salary when I was young and had it for 20 years until downsizing, it was Metlife and they converted it to an external policy, which I carried for another 20 years. The rates (term life) did adjust every 5 years or so. The benefit was enough to pay off mortgage, etc. I recently let it lapse after it was getting too expense to carry (age 60) and our liabilities were gone (mortgage, college, etc.)
Re: Life insurance through employer vs external
We have about 40x annual expenses saved in retirement + taxable accounts (3m) and I'd like to keep working for another 20 or so years. House is paid off, expenses are low, it's not really clear to us how much life insurance we "need"
Life Insurance through my employer is super cheap...I pay $36 per month for 2million in coverage which was the max benefit I could pick. Felt worth it to me, I'm assuming our existing savings could potentially also be used up quickly with a terminal health condition
Also have a 30 year term life policy that lasts another 15 years, I got it when I was 24. It's only 250k which seems insignificant now but I thought I might as well keep it, it's $250/y.
The employer provided life insurance is much cheaper...$432 per year for 2 million in coverage vs $250 per year for 250k of coverage. Although I guess if I had some terminal health condition, I might not be able or want to continue working and then I wouldn't have that employer life insurance...
Life Insurance through my employer is super cheap...I pay $36 per month for 2million in coverage which was the max benefit I could pick. Felt worth it to me, I'm assuming our existing savings could potentially also be used up quickly with a terminal health condition
Also have a 30 year term life policy that lasts another 15 years, I got it when I was 24. It's only 250k which seems insignificant now but I thought I might as well keep it, it's $250/y.
The employer provided life insurance is much cheaper...$432 per year for 2 million in coverage vs $250 per year for 250k of coverage. Although I guess if I had some terminal health condition, I might not be able or want to continue working and then I wouldn't have that employer life insurance...
Re: Life insurance through employer vs external
I had a friend who would tell folks that he bought a lot of life insurance to “guarantee his immortality”. Because, of course, “life insurance companies just HATE to pay death claims”.MedEngineer wrote: ↑Thu Oct 31, 2024 9:24 am My experience with employer insurance was good, I guess, I never used it, thankfully
It worked well for him. Until, one day, it didn’t….
Retired life insurance company financial executive who sincerely believes that ”It’s a GREAT day to be alive!”
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Re: Life insurance through employer vs external
Thank you again everyone. What do you mean "until one day it didn't". Did the insurance company not pay? I am sorry I didn't follow
Re: Life insurance through employer vs external
One day, the “immortality” conferred on him (because he owned life insurance) ceased. He died.AvocadoDeliberator wrote: ↑Thu Oct 31, 2024 10:29 pm Thank you again everyone. What do you mean "until one day it didn't". Did the insurance company not pay? I am sorry I didn't follow
But the insurance company paid. In full.
(That’s a Boglehead attempt at a joke)
Retired life insurance company financial executive who sincerely believes that ”It’s a GREAT day to be alive!”
Re: Life insurance through employer vs external
I carry the maximum level of coverage available through my employer that is guaranteed-issue, which is 5x my salary. Due to some items in my medical history, I cannot obtain life insurance on my own at any price that makes sense. So the very inexpensive coverage through my employer is a good deal for me. Keep in mind there are some of us who don’t have many choices if they want a meaningful level of life insurance.
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Re: Life insurance through employer vs external
This is the benefit of guaranteed-issue group insurance for you -- you're a higher risk but can take advantage by averaging in with healthier coworkers to get a good deal. The flip side is that, for healthier and/or younger folks, it can be cheaper to buy independent insurance.tim1999 wrote: ↑Fri Nov 01, 2024 11:18 pm I carry the maximum level of coverage available through my employer that is guaranteed-issue, which is 5x my salary. Due to some items in my medical history, I cannot obtain life insurance on my own at any price that makes sense. So the very inexpensive coverage through my employer is a good deal for me. Keep in mind there are some of us who don’t have many choices if they want a meaningful level of life insurance.
Anyone who is healthy will get a new term policy. The only people who convert are those who are high risk and can't qualify for a cheaper policy. term4sale.com is a good way to get a sense for what things ought to cost. We got our 15 yar policy through them and it was something like $300/yr for $1M of coverage, but that was almost 15 years ago. Note also that employer insurance will increase in cost each year. A term policy is not only portable but it locks in the quoted rate for the term.klebs01 wrote: ↑Wed Oct 30, 2024 12:34 pm The cost to convert that to individual policy was $28,510 annual premium. It converts to whole life. Can do term but value is limited to about 1/3 current benefit at 2.5x the current rate. Time for me to start shopping around. I hate this industry though. It’s so difficult to get quotes online and the want to funnel me to some slimy financial advisor.
Tip: if they do blood tests to underwrite you, ask for a copy of the results. Those are free tests and you might as well claim your copy of the results to forward to your doctor.