Many/most people rely on insurance coverages provided by their employer/work for their individual needs.  While work coverage provides a good foundation for protection plans, it is rarely enough and there are limitations to work coverages.

Most importantly, you have no control over work and group coverages.  They provide protection while you work for that particular employer, but if your circumstances change (voluntarily or involuntarily) then you lose your coverage.  You lose or your coverage is significantly reduced when you retire – just when you need it the most.

Work coverages are owned and controlled by your employer, as a result they are subject to change and many do change the terms regularly.  Coverages could be reduced or eliminated at any time.  The amounts of coverage are rarely sufficient to meet most family needs so individual coverage can be used to bridge and cover gaps.

Most work coverages will allow employees to top up basic employer coverages with optional additional coverages that the employee pays through payroll deductions.  Many people think these top up coverages are cheap options.  In most cases they are not.  They may be convenient, (payroll deduction), but they generally are not cheap and have limitations.  In most cases, the costs increase either annually or in 5 year rate bands (every 5 years).  We generally don’t notice because the deductions are made via payroll in incremental amounts.

Make sure you review your work coverages regularly (most people make elections when they join their employer but don’t make subsequent changes as family and life circumstances change) to ensure your changing financial circumstances are adequately covered.  Make sure you understand what the limitations are to your coverages (ie limits, exclusions, etc).  Most people assume that all disability protection is the same – it is not.   There are significant differences in disability plans between short term and long term coverage, wait periods and coverage periods.  Don’t confuse an Accidental Death and Dismemberment coverage as the same as Disability coverage.  They are very different.

A proper insurance plan often factors in work coverages, but work coverages are not sufficient and have limitations.  Ensure you understand the differences.