Employer life policy vs private

[alqassam]

My employer is offering giving life, disability and income protection policies, I also have my own life, dread disease and income protection. Would be fine to cancel the personal one and rely on the employer one only?

I can take that contribution and rather pump into raf or tax free account or ETF

 

[Hamster]

My understanding is that only income protection polic will pay out so the second policy is a waste.

Life cover and disability depends on your needs. Is it enough? Does your life cover cover your debt?

You may want to look at dread disease/severe illness cover. Thieves like Discovery may require you to take a minimum amount of Life Cover in order to give you dread disease/disability cover.

Luckily, it is the income protection policies that are most expensive and safest to cancel.

 

[Snyper564]

Oh yes, if you have a bond it may be a requirement that your cover covers that.

 

[alqassam]

Oh yes, if you have a bond it may be a requirement that your cover covers that.

So the employer one is 4x the other.

Thinking if just cancelling it pumping into investment.

It will also cover all my debts with quite a bit left over

 

[Cius]

The issue is the later you start your life cover the more expensive it is. Hence if you ever change jobs and lose your employer life cover and you want to start private again you are kind of screwed. Hence I prefer private insurance over employer as who knows if you stay at one company for life. Rather pay your own at a lower price for life regardless of employer.

Also, most employer scheme's are not that cheap. I work at a bank and the in house life cover is far more expensive than my private PPS cover. Also my disability cover at the bank is non job specific which is an issue to me. I am a knowledge worker (developer) so if I have a brain injury but can still say sweep floor's the work cover will perhaps pay out partial cover. PPS disability cover is job specific, so if you can't do what you did you are fully covered.

 

[SauRoNZA]

The issue is the later you start your life cover the more expensive it is. Hence if you ever change jobs and lose your employer life cover and you want to start private again you are kind of screwed. Hence I prefer private insurance over employer as who knows if you stay at one company for life. Rather pay your own at a lower price for life regardless of employer.

Also, most employer scheme's are not that cheap. I work at a bank and the in house life cover is far more expensive than my private PPS cover. Also my disability cover at the bank is non job specific which is an issue to me. I am a knowledge worker (developer) so if I have a brain injury but can still say sweep floor's the work cover will perhaps pay out partial cover. PPS disability cover is job specific, so if you can't do what you did you are fully covered.

That’s strange, my corporate group policy cover has always been significantly cheaper while offering more value than my private cover.

However I’ve always kept my private cover in place for the same reasons you mention, and having changed jobs now where it’s no longer included have to think about ramping it up but then my worry is that it’s overkill should I change jobs again in a few years.

 

[beefymoocow]

That’s strange, my corporate group policy cover has always been significantly cheaper while offering more value than my private cover.

However I’ve always kept my private cover in place for the same reasons you mention, and having changed jobs now where it’s no longer included have to think about ramping it up but then my worry is that it’s overkill should I change jobs again in a few years.

Yep. Always have private life cover. If you get diagnosed with an illness during employment change/lose your job. Your cover might not cover prexisting cover or not cover you at all.

 

[Hamster]

Hence if you ever change jobs and lose your employer life cover and you want to start private again you are kind of screwed

Some have the option to continue the benefit after you resign.

 

[mrmrrza]

My understanding is that only income protection polic will pay out so the second policy is a waste.

Life cover and disability depends on your needs. Is it enough? Does your life cover cover your debt?

You may want to look at dread disease/severe illness cover. Thieves like Discovery may require you to take a minimum amount of Life Cover in order to give you dread disease/disability cover.

Luckily, it is the income protection policies that are most expensive and safest to cancel.

Not so, you can over insure on life and dread disease cover... (have as many policies as you want).

Benefits of group cover are typically no individual underwriting; unless you want increased limits if this an option.
As the others have said a small personal policy is good to have (especially one that is paid-up and has a level premium pattern) as it protects you if you change jobs and can become part of an estate planning exercise.

 

[Hamster]

Not so, you can over insure on life cover... (have as many policies as you want)

What did I say?

 

[mrmrrza]

My understanding is that only income protection polic will pay out so the second policy is a waste.

This part. You can have several life policies, which will all pay in the event of death.

 

[Hamster]

This part. You can have several life policies, which will all pay in the event of death.

I know, I have multiple myself. Only one income policy will pay out though.

Income protection is not the same as life cover, if that's what you are thinking.

 

[mrmrrza]

Nope, maybe rephrase your original post so it is less ambiguous?

My understanding is that only one income protection policy will pay out so the income protection section on the second policy is a waste.