Understanding your life insurance needs

Life insurance can provide your dependents with financial support and peace of mind in case of your death. Although it’s difficult to consider, spend some time learning how life insurance works, when you should purchase a policy, and what coverage amount is right for your family. And keep in mind, Hewlett Packard Enterprise offers group term life insurance for you, your spouse, and your children, but you can also purchase additional life insurance on your own.

How does life insurance work?

In the event of your death, your family will certainly be dealing with emotional distress. Having life insurance can help prevent your loved ones from dealing with financial distress at the same time. Your family can use the proceeds of your life insurance policy to help replace lost income, eliminate debt, pay for college, or address other financial needs during an emotionally difficult time. Some types of life insurance also offer opportunities to build cash value over time.

When you purchase a policy, you enter an agreement with the issuing life insurance company. In return for your regular payments, called premiums, the life insurance company guarantees to pay a set amount to your beneficiaries upon your death. Beneficiaries receive the proceeds directly, so they avoid the delay and expenses associated with the probate process of passing down assets through a will. In addition, the proceeds are typically free from income taxes, although a large estate may be subject to estate tax.

When should I purchase life insurance?

It’s a good idea to review your life insurance needs whenever you experience a major life change, such as:

• Getting married: A wedding should prompt you to review your entire financial situation, including your income needs, debt, and other liabilities. You may want to add a layer of income protection for both spouses.
• Having a child: Welcoming a new family member increases your need for income protection. If you have a stay-at-home spouse, remember to include additional coverage for him or her, too, to reflect the value he or she provides to your family as a caretaker while you’re at work.
• Buying or renovating a home: For most families, the mortgage payment requires the greatest chunk of the monthly budget. Life insurance gives you a way to cover your family’s mortgage payments and home equity obligations in the event of your death.
• Changing jobs: If you change jobs or have a salary increase, you may want to consider raising your life insurance coverage accordingly. 

When you decide it’s the right time to buy life insurance, keep a few other considerations in mind. For example, many insurers require you to provide “evidence of insurability.” This typically involves a basic medical screening, often scheduled at your home or workplace. Generally speaking, the better your overall health, the lower your premium will be.

Your age can affect the rate you pay now and in the future, too. For example, it may be easier and less expensive to get life insurance coverage in your 30s than in your 60s. As you get older, your risk of having costly health issues increases, resulting in higher premiums for coverage.

How much life insurance coverage do I need?

Hewlett Packard Enterprise offers different life insurance coverage amounts for employees, a spouse or domestic partner, and children. Learn more about insurance options.

The “right” amount of coverage varies from person to person and depends on a number of factors, like your current and projected income, the number of dependents you have, and the estimated value of your financial responsibilities, such as college debt or loan payments. When considering the right amount of life insurance coverage for your situation, add up the costs of the following:

• Funeral expenses: The median costs associated with a funeral in 2026 is $8,300.¹ To be on the safe side, account for at least $15,000 in your life insurance coverage.
• Mortgages and other debts: Total your mortgage balance and any other outstanding loans or debt. Help ensure these debts can be paid off if necessary and that your family would be able to keep your home if it chooses.
• Education expenses: While college may be years away for your children, the cost of a college education is a valuable component to a life insurance policy. Research current costs for a college your child would be likely to attend, and factor in an average 2-3% increase each year.
• Income replacement: If your life insurance policy covers the three major expenses listed above, your family won’t need as much income to keep its current standard of living. Plan to cover half of your current pre-tax salary multiplied by the number of years you plan to work before you retire to ensure that your family can continue to live comfortably. 

Where can I learn more about the life insurance options offered through Hewlett Packard Enterprise?

MyHPERewards.com

You can learn more about your life insurance options in the Annual Enrollment materials you receive each fall.

¹ CNBC | How much does a funeral cost in 2026? | Feb. 2026

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