If you have life insurance, chances are you haven’t thought about it in a while. But, like your car registration, or the expiration date on your milk carton, life insurance policies require regular review. Here are 6 reasons why it’s important to review your life insurance regularly.
If There Have Been Major Changes in Your Family Composition
If there have been major changes in your family composition, such as marriage, the birth of children or grandchildren, or a divorce, you should review your life insurance policy to make sure it adequately meets your needs. With the addition of children or grandchildren to your family unit, you may want to consider a term policy instead of (or in addition to) whole life. It’s important to distinguish between need-based and want-based decisions when selecting your coverage amount and type; it’s easy to overlook key details when faced with changes that require careful consideration. You may want to speak with a qualified professional like Caspian Life Insurance who can help you determine the best coverage for your current situation.
The cost of policies will vary based on age and other factors (such as health), but by reviewing it regularly, you can ensure that you are getting the best possible rate for coverage that fits your needs. Reviewing more than one insurer could also have an effect on just how much money you save on premiums and help ensure that no matter what happens, you can provide for your family’s future financial security.
If There is a Change in Your Health Status
If you’ve experienced an unexpected change or decline in your health that could potentially impact your policy, then this is an important time to review your life insurance coverage. It’s essential to inform your insurer of any developments in order for them to evaluate the terms and conditions of the insurance plan. For example, if you were diagnosed with a serious medical condition such as heart disease, cancer, or diabetes, then it may prevent you from getting new coverage or result in a rate increase.
Similarly, if something happens that requires you to take medication on a regular basis, such as high cholesterol or high blood pressure, this can also affect the terms and conditions of the policy. At this point, it would be best to review whether the rates and levels of coverage still meet your needs and make any changes if necessary.
If There are Any Significant Changes in Your Financial Situation
Life insurance is one of the most important parts of your financial plan; it provides peace of mind and helps ensure that your loved ones are taken care of in the event of your death. As changes occur in your life, it’s important to review and adjust your life insurance policy accordingly. Here are six reasons for revisiting your life insurance policy:
Have you experienced any big financial changes, such as buying a home or making a large purchase? You might want to increase or decrease coverage based on these events. Increases/decreases in assets, including retirement accounts, should be reported since life insurance proceeds might otherwise impact those same assets in unexpected ways amidst a major life transition like death.
Before making any decisions about changing life insurance policies, consider what consequences could arise from doing so — some policies come with stiff penalties for termination — and speak with an expert who can help guide you through all available options
If You’ve Changed Jobs or Switched Employers
It’s also important to make sure your life insurance policy is current if you’ve changed jobs or switched employers. Many people make the assumption that the policy from their old job will carry over, only to find out later that it doesn’t. Not only that, but you could be paying more for coverage than necessary or restrictive terms, and conditions may apply to your current policy.
When you change employers, you should review whether the new job offers life insurance as part of their benefits package. If so, think about whether it would be advantageous to switch policies since it is most likely more cost-effective than an individual plan. Even if group life insurance is offered at no cost through a job benefits package, there are certain advantages and disadvantages associated with this type of coverage based on the individual situation. Be sure to assess all available options before making a decision.
If Any of Your Policies Have Expired or Been Canceled Recently
If any of your policies have expired or been canceled recently, it’s important that you review your remaining life insurance coverage so that you have adequate protection. Life insurance can provide extra financial security to your family in the event of an untimely death.
If You’ve Filed for Bankruptcy in the Last Six Months
If you’ve been in a difficult financial situation that has caused you to file for bankruptcy in the last six months, it’s important to have your life insurance policy reviewed and updated. Your financial situation has likely changed significantly since you took out your coverage, meaning that your current policy may no longer be sufficient.
Financial advisors recommend having a thorough review of your life insurance policies to ensure they are still relevant and adequate to meet your changing needs. If you’ve filed for bankruptcy, it is critical that you review both the life insurance policy coverage amount as well as its terms and provisions. Doing so will ensure that any potential debtors or potential beneficiaries are not left without sufficient protection should something unexpected occur.
In addition, if your family dynamics have changed since taking out the policy, such as marriage or having children, talking to a trusted expert will help make sure these new additions are added to the policy so that there is no confusion in the case of an unexpected death or event. Make sure all beneficiaries listed on the policy still need to be included; policies can often get out of date with names and inheritances changing over time.
Conclusion
In conclusion, life insurance agreements are dynamic and ever-changing. It is important to review your life insurance policy regularly to ensure that you are suitably covered and not paying more than necessary. To get the best value out of your policy, evaluate how much coverage you need at least once a year, explore other companies and policies for better rates, adjust coverage as necessary based on major life events, take advantage of any public assistance available in your area, check for excluded riders that might come with higher premiums and reread the policy yearly to make sure it still meets your needs. By taking these measures, you can ensure that you and your family are protected against unpredictable risks tomorrow and beyond.
