--- title: 3 Reasons Employer Paid Life Insurance is Dangerous description: Lots of people assume the life insurance they have through their employer is enough, but it never is. image: https://www.theamericaninsurancegroup.com/wp-content/uploads/2016/03/post-cover-image.jpg --- - [tel:423-362-4166](tel:423-362-4166) ### 423-362-4166 ![Cropped Blank Background-1](https://blog.valorbrokers.com/hubfs/Cropped%20Blank%20Background-1.png) - [About Us](https://valorbrokers.com/about) - What we do - [Personal Insurance](https://valorbrokers.com/personal-insurance) - [Commercial Insurance](https://valorbrokers.com/commercial-insurance) - [Get A Bond](https://aminsgroup.propeller.insure/axelerator-public/) - Get Coverage Now - [Request A Proposal](https://valorbrokers.com/proposalrequest) - [Get A Bond - Buy Now](https://aminsgroup.propeller.insure/axelerator-public/) - [About](https://www.theamericaninsurancegroup.com/about) - Insurance - [Personal Insurance](https://www.theamericaninsurancegroup.com/landing/personal-insurance) - [Commercial Insurance](https://www.theamericaninsurancegroup.com/commercial-insurance) - [FAQs](https://www.theamericaninsurancegroup.com/?page_id=21) - [Blog](https://www.theamericaninsurancegroup.com/blog) - [Contact Us](https://www.theamericaninsurancegroup.com/contact) - [Request a Quote](https://www.theamericaninsurancegroup.com/request-a-quote) ![Life Insurance](https://www.theamericaninsurancegroup.com/wp-content/uploads/2016/03/post-cover-image.jpg) # 3 Reasons Employer Paid Life Insurance is Dangerous By [Keith Rocha](https://blog.valorbrokers.com/author/keith-rocha) | March 25, 2020 Do you have a life insurance policy through your employer? If so, you might be at more risk than you'd think. Relying on an employer-paid policy can be risky. Everyone needs to own a life insurance policy, separate from their employer.  Here’s why: **1. Their Policy is Never Enough** Many employer-paid plans only provide 1-2 times your annual salary as the death benefit. This is never enough to take care of your loved ones. An easy way to determine how much life insurance you need, is to use a [life insurance calculator](https://lifehappens.org/insurance-overview/life-insurance/calculate-your-needs/). If you'd rather talk to another human about it, [we can of course help](https://www.theamericaninsurancegroup.com/contact) with that. **2. Their Policy May be Taxable** Because some or all of the life insurance benefits from work are paid for by the employer, the benefits might face some unfortunate taxes. We've talked about this before [here on our blog](https://blog.valorbrokers.com/blog/your-group-life-insurance-may-be-taxed). No one wants to pay more taxes and lose out on money that should have been in their own pocket. **3. Their Policy Can't Go With You** Similar to other benefits, if you leave the company you can’t take the life insurance with you. The position with your new company may not come with group life insurance. The average employee only stays at the same business for [4.4 years](https://www.theamericaninsurancegroup.com/employer-paid-life-insurance#). Typically, group life is only available from a large employer. With [50%](https://www.theamericaninsurancegroup.com/employer-paid-life-insurance#) of the working population employed by a small business, it makes sense to go ahead and have your own policy in place. When it comes to life insurance, you don't want to risk leaving your loved ones in a financial lurch as they mourn.      [← 3 Insurance Mistakes Real Estate Investors Make](https://blog.valorbrokers.com/three-insurance-mistakes-real-estate-investors-make) [Grant Available to Small Businesses: Save Small Business Fund →](https://blog.valorbrokers.com/grant-available-to-small-businesses-save-small-business-fund) ## Recent Posts ### Archives - [March 2020 (8)](https://blog.valorbrokers.com/archive/2020/03) - [April 2020 (2)](https://blog.valorbrokers.com/archive/2020/04) - [June 2021 (1)](https://blog.valorbrokers.com/archive/2021/06) - [August 2021 (1)](https://blog.valorbrokers.com/archive/2021/08) - [February 2022 (1)](https://blog.valorbrokers.com/archive/2022/02) ### Categories - [Business Insurance (5)](https://blog.valorbrokers.com/tag/business-insurance) - [auto insurance (4)](https://blog.valorbrokers.com/tag/auto-insurance) - [COVID-19 (3)](https://blog.valorbrokers.com/tag/covid-19) - [Real Estate Investor (3)](https://blog.valorbrokers.com/tag/real-estate-investor) - [independent agent (3)](https://blog.valorbrokers.com/tag/independent-agent) - [Dwelling Fire (2)](https://blog.valorbrokers.com/tag/dwelling-fire) - [Inflation (2)](https://blog.valorbrokers.com/tag/inflation) - [Landlord (2)](https://blog.valorbrokers.com/tag/landlord) - [Life Insurance (2)](https://blog.valorbrokers.com/tag/life-insurance) - [Rates (2)](https://blog.valorbrokers.com/tag/rates) - [accident (2)](https://blog.valorbrokers.com/tag/accident) - [claims (2)](https://blog.valorbrokers.com/tag/claims) - [taxes (2)](https://blog.valorbrokers.com/tag/taxes) - [Business Interruption (1)](https://blog.valorbrokers.com/tag/business-interruption) - [Cyber Insurance (1)](https://blog.valorbrokers.com/tag/cyber-insurance) - [IRS (1)](https://blog.valorbrokers.com/tag/irs) - [Investor Lunch (1)](https://blog.valorbrokers.com/tag/investor-lunch) - [MVR (1)](https://blog.valorbrokers.com/tag/mvr) - [home insurance (1)](https://blog.valorbrokers.com/tag/home-insurance) ### BUSINESS HOURS Monday – Friday, 8:30 am – 5:00 pm. ### COVERAGE DISCLAIMER Please note no coverage will be assumed bound or covered without written or verbal confirmation from a licensed agent of The American Insurance Group, LLC dba Valor Insurance Brokers [Terms of Use](https://www.theamericaninsurancegroup.com/terms-of-use) [Contact](https://www.theamericaninsurancegroup.com/contact) ### CONTACT INFORMATION Address: 620 Cherokee Boulevard, Suite 100 Chattanooga, TN 37405 Phone: [423-362-4166](tel:423-362-4166) © 2023 The American Insurance Group, LLC dba Valor Insurance Brokers. 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