life insurance and disability

[LivingAlmostLarge]

Question why is it odd to buy life insurance outside of your job? Everyone i've talked to (friends) have asked me why we bought it outside DH's job. I said we bought life and never qualified for more disability, but we had looked into it.

I know on here people do. Why did you guys do it? Is it abnormal? I thought you were supposed to buy life insurance?

Isn't it a risk to buy it through your job? Or is it just cheaper to buy it outside? FWIW most don't have more than what their jobs provide, but they did talk about possibly buying more from the company.

I mean it's so cheap to buy term life insurance. Its $250/yr for $500k for me and $1500/yr for DH $4M. we are covered another almost 18 years right now (we bought 25 year terms when we had DK1) and our kids are 5 and 7.

[Like2Plan]

Funny, but we just reached a major milestone--we canceled DH's outside LI.
The reason we bought it many years ago was because we wanted more coverage than what his employer offered and to be covered in case DH left his job. Now, we don't need it.

I have a policy (still in force) that we bought because it was cheaper than what was available through my employer. (I also have a small policy from my old employer still in force--so, I hedged my bet. )

[MooseBucks]

I have some through work because they subsidize it so it’s actually cheaper than my policy outside of work. I have a 1 mil term policy outside of work and my wife has 500k. By the time my policy expires the plan is to just go with the coverage through work as kids will be close to finishing college and house will paid off.

[disneysteve]

Question why is it odd to buy life insurance outside of your job?

It's not odd at all. It is EXACTLY what EVERYBODY should do. Far too many people depend on the coverage they get through their job. Then they leave the job for one reason or another and no longer have that coverage. At that point, they are older and may find it harder and more expensive to get coverage on their own.

The other problem is that most employer coverage is for a minimal amount, often just 1 or 2 times your annual income. Most people need 8-10 times their income in coverage so the work policy is a nice bonus but it doesn't replace getting coverage on your own.

[LivingAlmostLarge]

But when you switch jobs don't most companies offer you a chance to buy insurance again? So you wouldn't necessarily be uninsured but you could be.

[disneysteve]

But when you switch jobs don't most companies offer you a chance to buy insurance again? So you wouldn't necessarily be uninsured but you could be.

Right. You might get coverage again but you might not. And if you are between jobs for some period of time, you may not have coverage then. The job I have now is the first time in my life that I've had employer-provided life insurance. I just got that in March.

Why take the chance. Term coverage is dirt cheap. Everyone should buy a policy and be covered. Don't depend on a work policy as the only protection for your family.

[corn18]

I carry enough term life outside of my job to cover everything I need. The work insurance is a bonus and would make my wife a very rich women if I died while we had both (I have an additional $1.9M through work).

This is my outside term life plan. I am perfectly insured with my current coverage. I laddered it so as I save more, I have less insurance.

I like not relying on work and it gives me options.