Tuesday , September 17 2019
Home / Money / Insurance / Top 6 Reasons Why You Should Do An Annual Life Insurance Review
life insurance advice

Top 6 Reasons Why You Should Do An Annual Life Insurance Review

He should know: writer Richard Reich has advised thousands of clients on their life insurance policies.

Just like spring-cleaning, reviewing your life insurance policy should be on your yearly to-do list. Major life events such as marriage, birth of children, divorce and retirement can influence your life insurance needs and may influence you to increase or decrease the size of your policy. Take a look at the top six reasons why you should review your whole life insurance policy every single year:

  1. Your Children Become Financially Independent

Many life insurance policies leave some portion of benefits for the policyholder’s children. But as your children grow and become financially self-sufficient, your policy might need to change. Once your children are able to support themselves, you might want to lower the amount of your policy, which will subsequently decrease your rates. Additionally, if your children get married or have children of their own, chances are they are going to invest in their own policy – leaving less of a reason to include them on yours. As the lives of your children change, so should your life insurance policy.

  1. Marriage

Finally settling down or remarrying is another major incentive to annually review your life insurance policy. Getting married means that you’ll probably want to increase the amount of your policy, leaving a significant portion to your partner in the event of your death. Your premiums might increase, but you’ll have the added support of sharing your life with someone new. Start planning your new life together and preparing for the future by reevaluating your life insurance policy.

  1. Divorce

On a heavier note, divorce is one of the leading causes of cancelled or modified policies. A significant portion of your death benefit was probably assigned to your spouse. With your situation changed, you might want to lower the amount of your policy to only include your children or other family members. You might not have any reason to pay higher premiums if your marital status has changed; however, many divorce decrees include continuation of life insurance, so don’t start the process of changing your policy until the divorce is finalized.

  1. Healthier Habits

When you apply for life insurance, your health is evaluated and your life insurance policy rates are determined by the health class that you are categorized in. So unhealthy habits can play a role in how much you pay for life insurance. For example, smokers are known to pay significantly more for life insurance than nonsmokers. A change in diet or exercise, or quitting smoking, can impact your monthly life insurance rates for the better. It’s always a good idea to review your life insurance policy if your health has improved.

  1. Comparison Shopping

Many life insurance companies offer similar policies and benefits with significantly different rates. When shopping for a life insurance policy, it’s important to compare rates from top-rated companies to make sure you’re getting the best deal. Even if you’re already insured, getting a quick quote could potentially save you money. As with any big purchase, it helps to be an informed consumer.

  1. Retirement

As you prepare for retirement, your life insurance policy may need some upkeep. Changes in living expenses, health care costs, and career changes may prompt you to adjust the amount of your policy and your rates. As you evaluate your portfolio, it’s important to keep your insurance policies in mind. Make sure that you can still afford to pay your premiums during retirement instead of simply abandoning your policy. You don’t want all of those years of premium payments to be for nothing. 

 

About the Author:

Richard ReichRichard Reich is President of Intramark Insurance in Glendale, CA. As an independent life and disability insurance broker, he has personally assisted thousands of clients with their insurance needs. He invites you to learn more at LifeInsure.com or InstantQuoteLifeInsurance.com today.

Check Also

Reverse Mortgage pros

5 Upsides To An HECM Reverse Mortgage

As you near your golden years, the last thing that you want to have to ...