Group Life insurance is a great employee benefit. Here’s why it’s not a substitute for long term family protection

by | Jul 8, 2021

Companies that provide good employee benefits act as standard bearers for what it means to be a great employer. These employers understand that employee benefits are a key component of employee engagement, impacting how committed, productive and invested an employer’s workforce is. They understand they are more likely to attract and retain valuable talent in a competitive employee marketplace if they offer competitive benefits. The fact that employee benefits can help lower employee attrition (by as much as 56%, according to LinkedIn’s 2020 Global Talent Trends report1 demonstrates how much the value of employee benefits exceeds the costs.

ReMark Group conducts one of the largest life insurance consumer surveys annually, focusing on a range of different insurance-related subjects each year. Their 2019 survey2, conducted with over 11,000 consumers across 16 developed and developing countries, identified that 43% of respondents were covered under an employer-provided life insurance scheme; and 60% felt this cover was sufficient.

Whether or not an employee perceives their Group Life insurance cover as sufficient is important, but it is equally important that they recognise it as an employee benefit, and not a substitute for individual life insurance and family protection. Here are three important reasons why:

1. Group life policies are not personalised for your family

You and your family are unique, as are the circumstances which determine how much life insurance you need. The size and age of your family, your household income and retirement timeline, what future expenses (such as education costs) you must plan for and how much debt you currently have all need to be considered when determining how much life insurance you need and what type of policy (or policies) you should consider buying to protect your family in the event of your death.

2. Group life cover alone is almost certainly not enough

Group life policies typically cover 3 to 5 times an employee’s annual salary. While these are good levels of cover from an employee benefits perspective, it’s almost certainly not enough for family protection.

Most experts agree – depending on the circumstances of the family – the recommended cover level for family protection is 10 to 20 times annual income. Families who rely solely on employer-provided insurance as the solution for their long-term family protection needs are likely to be under-insured.

You may want to use the Unisure Family Protection Calculator which can help you estimate how much insurance you need to protect your family in the event of your death.

3. You cannot assume company benefits will be available to you indefinitely

Most employer-provided Group Life plans are not portable, which means if you leave the company for whatever reason, you will no longer be covered under their employee benefits policy.

For those families who relied solely on their Group Life cover for family protection, in these scenarios they would suddenly be without any life cover at all. Then consider the worst-case scenario, where it might not be possible to buy personal life insurance at that time – due to age or health constraints. This scenario could place your family at serious financial risk.

The simplest way to avoid these risks is for a family to buy international life insurance that they control to protect themselves over the long term.

A Group Life policy cannot possibly consider all these factors, and nor should it need to, as it’s not a substitute for long term family protection.

To learn more about The Unisure Group’s individual life insurance solutions, visit or email