Today, many companies offer group life insurance as part of employee benefits. While it's a great perk, it might not fully meet your personal needs. Understanding your employer's life insurance can help you see where it fits in your financial planning. Often, work-life insurance isn't enough for complete protection.

Life insurance is key to a balanced financial plan. Here's why your employer's policy might not cover all your financial goals.

#1 - Employer-provided life insurance might not offer enough coverage. Employers aim to reduce costs, deciding how much coverage to offer, often limiting the death benefit for your beneficiaries. This means the policy’s value could be lower than needed. Usually, you'd want coverage worth 10 to 12 times your income, but employer policies often only cover one to two times your salary.

#2 - Losing your job could mean losing your life insurance since employer-provided coverage often isn't portable. You can't be sure your next job will offer the same benefits, and converting to an individual policy might cost more.

This issue is even bigger if you're leaving a job later in life or due to health problems. Life insurance is cheaper when you're younger and healthier. As you age, premiums go up, and health changes can make policies pricier or even out of reach.

#3 - Group life insurance from employers usually offers basic term coverage without extra benefits. It mainly pays a death benefit, often with limited coverage. Usually, employers pay the premiums, and the insurance agreement is between the employer and the insurer. This means employees can't get tax benefits for these life insurance policies.

#4 - Employer life insurance often costs more when you buy extra coverage. Employers might offer more insurance for an extra fee, but this can be pricey, especially for younger folks, since prices are set for the whole group. These rates depend on the employees' overall health and age. However, buying your policy considers just your health and age, with no group factors affecting the cost.

#5 - No Guarantees with Employer Life Insurance: Under an employer's group life insurance, you don't have much control—the employer decides the benefits. Remember, this insurance is a perk, not a promise, and can be cut if the company struggles.

Relying only on your employer's life insurance isn't wise for your financial planning. Insufficient coverage or losing it can lead to financial trouble during an unexpected crisis, leaving you unprotected. It's important to have your plan to avoid starting from scratch.