The Complete Breakdown of Voluntary Life Insurance

Back to blog

The Complete Breakdown of Voluntary Life Insurance

The Complete Breakdown of Voluntary Life Insurance

So, you’ve just been hired to a job or are out of your probation period and are able to claim benefits, congratulations! As you’re scrolling through the health and wellness items you can claim you happen upon insurance types that are marked as optional. These are known as voluntary life insurance. But what is voluntary life insurance? Should you sign up for it?

We break down the answers to that below.

What Is Voluntary Life Insurance?

Typically included in employee benefits is coverage that includes supplementary medical and dental, accidental death and dismemberment insurance, and long-term disability. Your employer can pay for some or all of this (depending on the company) or you may be responsible to pay for of it (where it’s deducted from your paycheque).

Voluntary life insurance often includes coverage that usually encompasses:

  • Additional group life insurance
  • Life insurance for your dependents
  • Critical illness insurance
  • Home and automobile insurance

As the name for these items suggests, they are voluntary, or optional, but usually are an out-of-pocket expense for the employee who wants to use them. However, because it’s bundled into a group benefits package, the coverage options are often much more affordable than if you were to buy them as an individual on your own.

Young businessman trying to answer what is voluntary life insuranceWhy Should You Consider Getting Voluntary Life Insurance?

If you have current health conditions or other issues that make getting life insurance or other types of coverage more challenging, voluntary life insurance is often guaranteed. This means you don’t need to get a physical or other health tests to qualify for it.

As such, it’s incredibly beneficial for people who have health problems that prevent them from getting more affordable coverage.

Naturally, the convenience of it is also incredibly handy. It’s not another bill you need to manage yourself as it’s handled by the person in your company that manages payroll. Plus, you’re getting additional coverage that would generally otherwise be more expensive to purchase on your own.

Is Voluntary Life Insurance Portable?

It’s a good idea to check into whether or not voluntary life insurance is portable, i.e. whether or not you can still access it if your current employment ends with the company you’re actively working at.

To find out, go through your benefits package and determine if it is or talk to your benefits representative. Also, bear in mind that your premiums may increase once you leave your current company as they may not support paying for your premiums once you’ve left. In general, rarely are most group benefits packages portable once you’ve left the company.

Businessman happy after getting voluntary life insuranceDo You Need Voluntary Life Insurance?

As previously mentioned, voluntary life insurance is incredibly useful for people who are in situations where purchasing life insurance would be too expensive or are unable to qualify for it due to health issues. Through voluntary life insurance, you can get essential coverage that’s just not possible otherwise.

For people without pre-existing conditions or other health concerns, it’s less useful, but still often beneficial to get. If you want a more personalized policy tailored to your specific needs, then it’s best to consult with a life insurance provider to determine how much life insurance you need.

Overall, voluntary life insurance provides valuable financial protection to those it may not be possible for and is a viable and helpful option to supplement any existing life insurance.

 

 

Looking to set up group benefits for your business? We can help! Contact us today to book an appointment.