Life Insurance

Employer Provided Life Insurance

Employer-provided life insurance compensates survivors for lost wages and income in the event of your death. Large employer plans often offer life insurance coverage of $50,000 or 1x salary as a default, with options to increase coverage based on your needs. Group plans tend to have lower costs and less stringent underwriting processes. This can be especially beneficial for those with dependents, growing families, or pre-existing conditions, as group life insurance can provide additional coverage that might be too costly through a private insurer.

Most life insurance provided through employers falls under the category of group term insurance, meaning coverage ends when employment ends.  Depending on outside life insurance coverage, this is an excellent benefit to take advantage of, particularly if there is a gap in life insurance coverage, you plan on staying with your employer, and individual life insurance policies may be expensive due to health conditions, age, or other factors.

Employers usually offer 1x or 2x base salary coverage with the option to increase further. Keeping in mind that coverage over $50,000 is included in income as it is a taxable benefit.

Spousal Life Insurance coverage usually is offered by employers as well, though for a cost, and may be a good option if your spouse does not have other coverage.

If you aren’t sure if you have sufficient coverage in life insurance or may be paying (and taxed) on something you might not need, contact your advisor at Meridian for assistance in running these numbers.

Term Life Insurance

When choosing an outside policy, consider factors such as your family’s living expenses, outstanding debts, and future financial needs like college tuition. Term life insurance is a popular and affordable option, providing coverage for a specified period, usually covering the period of time until dependents have moved out of the house or at the time of retirement.