Is Voluntary Term Life Insurance Worth It?
Voluntary life insurance policies provide additional coverage on top of an employer-provided base life insurance plan. These policies may be available as either term life or whole life insurance. Term life insurance coverage lasts for a specified level term period, such as a decade, and is usually less expensive than whole life insurance. Whole life insurance and universal life coverage remain in place throughout the policyholder’s life and can build cash value that you can tap into when necessary. Accidental Death & Dismemberment (AD&D) insurance covers deaths due to accidental causes and specific injuries and is often offered at low rates by employers.
| Reasons to consider voluntary life insurance | Drawbacks of voluntary life insurance |
|---|---|
| Provides additional coverage on top of employer-provided life insurance | May not be enough to cover total life insurance needs |
| Easy to sign up for without a medical exam | May not be the most cost-effective option |
| May be a convenient option for those seeking additional coverage | Policy may end when employment ends |
While voluntary life insurance policies can be a good option for those seeking additional coverage, they may not be the most cost-effective option and may not provide enough coverage for your total life insurance needs. Additionally, the policy may end when employment ends. It’s best to consider employer-based life insurance as a supplement and buy your own individual life insurance policy to ensure that you have coverage no matter where you work. Comparing policies with multiple insurers can help you find the best coverage for your needs.
