One of the most important benefits that employers give their employees is the benefit of group insurance. For some, these group benefits are the only forms of insurance protection that an individual will ever have. But when possible, employees should enjoy these group benefits not as a sole source of protection from all the financial risks they face, but as a supplement their personal insurance policies.If you aren’t sure why you should have both individual and group insurance coverage, consider these points on three different types of group insurance policies:
- Life insurance: Group life insurance benefits are very inexpensive and can be a great comfort to your family if they lose you while you are employed. But these plans are not portable—meaning you can’t take them with you when you leave. Having your own life insurance policy allows you the comfort of knowing you are insured whether you are employed or not. In addition, group life insurance benefits do not generally include accruing cash values which can be a source of tax-free loans in the future.
- Health insurance: Group health insurance coverage is especially helpful when you have a pre-existing condition that is hard to get covered with an individual health insurance policy. Group health costs can also be more affordable for those who have pre-existing conditions. However, group coverage can be less competitively priced for those who are young and healthy. It is also restrictive in options. You may not be able to see your existing doctors and have it covered in-network. And when you leave your employer, you can only carry the coverage for an additional 18 months in most instances.
- Disability: When you are employed and covered by a group disability insurance plan, you will have an affordable premium along with the protection of either short- or long-term disability benefits—and in some cases, both. This will be especially helpful if you suffer an injury that is not covered by workers compensation. But if you leave your job and go to another employer who doesn’t offer that benefit, you could be left without a disability benefit after a non work-related accident, illness or injury.
