Does Voluntary Life Insurance Make Sense for You?

what is voluntary life insurance

what is voluntary life insurance

Voluntary life insurance is a type of insurance offered as part of a group insurance policy that typically covers employees in the event of their death. It is an additional benefit offered by employers that they typically don’t pay into, but offer via a third-party provider. If an employer offers life insurance then this coverage would be on top of that separate policy. Deciding to opt into voluntary life insurance is completely up to the employee and the right choice will depend on their situation. If you want personalized advice, consider working with a financial advisor to determine your life insurance needs.

What Is Voluntary Life Insurance?

Some employers offer voluntary life insurance. It’s a type of group life insurance policy that’s an optional perk for some employees. As an employee, you’ll pay a monthly premium out of your paycheck. If you pass away while the policy is effective, then your beneficiaries will receive the agreed-upon death benefit. Depending on your company, you may also be able to purchase voluntary life insurance for your spouse and children.

Generally, you can purchase voluntary life insurance when you start a new job at a company that offers this perk. In some cases, you’ll have to wait until the annual open enrollment period to tap into this benefit or wait until after an initial period of time. Whenever you become eligible for other benefits offered by your employer is typically when you would be eligible for this benefit.

Types of Voluntary Life Insurance

Voluntary life insurance comes in two forms.

1. Voluntary whole life insurance: Whole life insurance is designed for a person’s entire life. There’s a cash value that accumulates through investments or a fixed interest rate. Whole life insurance is a more complex vehicle, but it

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