Life Insurance Through Work vs Individual Life Insurance: Which fits your life and budget?
Many employers offer group life insurance, often around one or two times salary. An individual policy is one you buy and own yourself. Most families who rely on one income find workplace coverage alone isn't enough.
The short answer
Life Insurance Through Work
Best as a free or low-cost starting layer of coverage while you have the job.
Individual Life Insurance
Best if you want coverage you own, at the amount your family actually needs, that stays with you if you change jobs.
Side-by-side comparison
| What matters | Life Insurance Through Work | Individual Life Insurance |
|---|---|---|
| Ownership | Tied to your employer | You own the policy |
| Coverage amount | Often limited to a multiple of salary | Chosen by you to fit your needs |
| Portability | Usually ends or changes when you leave | Stays with you regardless of job |
| Underwriting | Often guaranteed up to a basic amount | Health questions or exam may apply |
| Cost | Often free or payroll-deducted | Based on age, health and term |
Life Insurance Through Work in detail
Group life insurance is a common workplace benefit. It's easy to get, but the amount is set by the employer's plan and coverage typically depends on staying employed there.
Individual Life Insurance in detail
Individual term or permanent policies let you lock in a rate and an amount sized to your mortgage, debts and family needs, independent of your employer.
Life Insurance Through Work: pros and cons
- Little or no cost
- Easy enrollment
- Coverage often too small
- May end when you leave the job
Individual Life Insurance: pros and cons
- You control the amount
- Portable for life of the policy
- Lock in rates while young
- You pay the full premium
- May require health questions
Still unsure? Get guidance.
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