What Happens to Group Life Insurance If You Leave Your Job?
Learn how job changes affect your coverage and what steps you can take to stay protected
If your life insurance is provided through work, it can be easy to overlook one important question — what happens to that coverage if you switch roles, leave your job, or retire?
Group life insurance is one of the most convenient benefits offered by employers. It often requires no medical exam, is free or low-cost, and offers an immediate safety net. But in most cases, it is tied to your employment. That means your coverage may be temporary — and the day you leave your job, your protection could change or end.
Understanding how this works is essential to making sure your insurance keeps pace with your life.
Does Group Life End When Your Employment Does?
In most cases, yes. Group life insurance is issued under a master contract that covers all employees of a company. When you leave the company, you are no longer part of that group, and your insurance coverage usually ends automatically.
Some employers offer a brief extension, such as 30 or 60 days of coverage. Others may offer a conversion or continuation option, but this is not guaranteed and often comes with conditions.
Note: These options are rarely automatic. If you want to keep any part of your coverage, you typically need to act within a limited window after your departure date, often just 30 days.
Conversion vs. Portability: What’s the Difference?
| Option | What It Means |
|---|---|
| Conversion | Allows you to change your group coverage into a permanent individual policy |
| Portability | Lets you keep your group term policy by paying the premiums yourself |
Both options can be helpful in certain cases, but they come with trade-offs:
-
Converted policies tend to be expensive and offer limited flexibility
-
Portable policies may only last a few years, and costs typically rise each year
Tip: If you are in good health, applying for new individual life insurance may give you more coverage at a lower cost than converting or porting an old group policy.
What If You Rely on Group Life Alone?
Relying entirely on group coverage creates a gap during job changes. Whether planned or unexpected, career transitions are already financially disruptive — losing life insurance at the same time can add unnecessary stress.
If you are supporting others or have long-term obligations like a mortgage, child care, or education savings goals, group life is not enough on its own.
What to Do Before Leaving Your Job
If you are planning a job change, retirement, or any kind of leave, review your life insurance situation ahead of time:
-
Ask your HR team about conversion and portability options
-
Check the deadline for taking action (often 30 to 60 days post-departure)
-
Compare the cost of converting versus getting a new term life policy
-
Use this transition as a prompt to reassess your coverage needs more broadly
Stay Ahead of the Coverage Gap
Group life insurance is a valuable benefit, but it was never meant to be permanent. If you are between jobs, moving to self-employment, or retiring early, the loss of workplace coverage can leave a serious gap — unless you have planned ahead.
Building your own life insurance plan outside of work puts you in control. It stays with you regardless of where your career leads and ensures your protection continues, even during the in-between times when your family may need it most.