How much life insurance does employer coverage usually provide?

Most employers provide a base benefit of one to two times annual salary at no cost, with an option to buy supplemental coverage up to four or five times salary. The base benefit alone rarely covers a family's actual income-replacement need.

Is employer life insurance portable if I leave my job?

Usually not. Most group policies end or convert to a much more expensive individual policy when you leave. The conversion option is rate-locked at your current age and health, but the cost is typically multiples of the equivalent term policy on the open market.

How do I figure out how much life insurance I actually need?

A common starting point is 10 to 12 times your gross annual income, plus enough to pay off the mortgage and fund education for any dependents. The right number depends on what your household would actually need to keep its lifestyle if your income disappeared.

Should I keep my employer coverage and buy more on my own?

Often yes. Employer coverage is a useful no-cost baseline, and a separate individually-owned term policy fills the rest of the gap and stays with you across job changes. The two together usually cost less than buying enough supplemental coverage through work.

Is employer-sponsored life insurance enough? A self-check

If you've ever filled out the benefits enrollment form at a new job, checked the box for the free 1× or 2× salary life insurance, and figured that was handled, you're not alone. Group life through work is a useful baseline. For most families with dependents, though, it falls short on three predictable axes. Here's a 10-minute self-check.

Axis 1: Coverage amount

The base benefit at most employers is one to two times annual salary, often capped at $50,000 or $100,000. A common income-replacement target is 10 to 12 times annual gross income, plus the mortgage balance, plus the cost of educating any dependents.

A 38-year-old earning $140,000 with a $400,000 mortgage and two young children is usually looking at a coverage need somewhere between $1.8M and $2.2M. A 2× salary employer policy gets that household to $280,000. That's a meaningful gap.

Axis 2: Portability

Employer life insurance is almost always tied to your employment. When you leave — whether you quit, get laid off, or retire — the coverage typically ends. Most group policies offer a conversion option to an individual policy, but it's priced at the carrier's standard rate at your then-current age, with no underwriting credit for your health. Conversion premiums tend to be several times what an equivalent term policy would have cost on the open market.

The practical implication: even if your employer coverage is sufficient today, you have no contractual guarantee it'll exist after your next career move. A separate individually-owned term policy gives you a benefit that moves with you.

Axis 3: Cost of "supplemental" coverage

Most employer plans let you buy supplemental coverage on top of the base benefit — sometimes up to 5× or 8× salary. The premium is typically presented as a convenient payroll deduction, and for some employees it can be the right answer. But two things are worth checking before you sign up:

Group rates are age-banded and re-priced. The price you see at 35 is not the price you'll see at 50. By contrast, a 20- or 30-year individually owned term policy locks the premium for the full term.
Underwriting is sometimes lighter, sometimes the same. Lighter underwriting can be a real benefit if you have a health condition that would be expensive on the open market. If you're in good health, an individually underwritten term policy is usually cheaper than the supplemental option through work.

A 10-minute self-check

Open your benefits portal and write down:

Your base employer life insurance amount.
The amount of any supplemental coverage you've elected.
Your annual gross income.
Your mortgage balance.
A rough number for what your dependents would need beyond that (childcare, education, etc.).

Add up the income-replacement target (roughly 10–12× income) plus the mortgage plus the dependent number. Subtract your total employer coverage. The remainder is the gap an individually owned term policy is designed to fill.

What to do next

If the self-check turned up a gap and you want a second set of eyes on whether term, layered terms, or something else fits your situation, the first call is twenty minutes and there is no script.