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This Web site contains a compilation of more than a thousand consumer finance  columns written by Tony Novak from the 1980s through 2006, updated and reformatted for maximum usefulness today.  New material was added after 2010.

Content is the opinion of the author and does not represent the position of any other person or entity. Information is from sources believed to be reliable but cannot be guaranteed.

The author is paid for product endorsements and has an ownership or other financial interest in the businesses related to the topics covered.

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Amount of group life insurance

originally posted: 11/22/2006  revised: 2/21/2011

Q: Are there limits on the amount of life insurance I can provide to employees of my 5 person business?

A: No, but as a practical matter in a small business like yours it makes sense to provide $50,000 per employee as a tax-free group insurance benefit and any additional amount provided by a separate individual policy (rather than through group insurance) on an after-tax basis. This simplifies the paperwork and accounting for tax purposes and generally results in the lowest overall cost. The cost is so low for the first $50,000 per person that it does not make sense to provide less than this amount - the administrative cost would probably more than the insurance cost. Life insurance is usually available as an optional benefit on a group health insurance plan.

Life insurance coverage up to $500,000 is now available directly online without any personal appointment, medical exam or blood test.

More resources:

Smart term medical insurance