Employer life insurance is one of the most common reasons families think they are covered when they are not. It is a genuine benefit. It is also a weak foundation, for three specific reasons.
It is usually small
Group life is typically one to two times your salary, sometimes with an option to buy a bit more. For a household with a mortgage, dependents, and years of income to replace, that amount rarely matches the real need. It can cover final expenses and a little breathing room, but it is not a plan for your family’s future.
It is tied to your job
Group coverage generally ends when your employment does. Change jobs, get laid off, or retire, and the coverage usually goes with the paycheck. Conversion options exist sometimes, but they can be limited and expensive. The protection is only as stable as the job, which is not the kind of certainty life insurance is supposed to provide.
It is not yours to control
Because the employer owns the master policy, you do not control the terms, the amount, or whether it continues. An individual policy you own is portable, locked in at your current age and health, and stays in force as long as you pay for it.
How to tell if you have a gap
Add up your real need: income replacement for the years your family depends on you, the mortgage, other debts, and goals like education. Compare that to your group coverage. The difference is your gap, and for most families with dependents, the gap is large.
The right way to use work coverage
Keep the group policy as a supplement, and build your foundation on an individual policy that is sized to your need, portable, and yours to control. A coverage review calculates your real number and shows you exactly how much of it your employer coverage actually covers.