Life insurance is almost a must-have in company benefits and most companies provide supplement life insurance that allows employees to increase coverage easily at the time of benefit enrollment. This time last year, I discussed my election for term life insurance. For the sake of convenience, I finally bought about $500,000 in supplement life insurance for both my wife and myself at about $50/$100,000 coverage/year.

Apparently I overpaid. In September and October, in anticipation of the international move and more (perceived) risk, I acquired more term life insurance from AIG. My 15-year $1,000,000 policy only costs $360/year, and my wife's 15-year $750,000 policy bears only $275/year. Of course, we are non-smokers and our excellent health and young age (~30) helped.

Now that I am moving to a new statutory company and a new set of benefits apply. For supplement life insurance through employer, the rate will be $110/year(!) for every $100,000 coverage. That's almost twice more expensive than my coverage through AIG (and not to mention the 15-year fixed-premium guarantee). I don't blame the company; I don't think they are making a profit -- the statutory company I moved to was set up specifically for Microsoft worldwide expatriates, and most of them are in 40s and 50s (and overworked through their Microsoft or pre-Microsoft career). Fortunately, this time I already have my backup plan lined up.

The lesson: if you are younger or more healthier compared to the demographics of your company, you might be well served by securing your own term life insurance policy. It will be cheaper and give you more peace of mind.