Denis Doulgeropoulos
Your Financial Professional & Insurance Agent
Four Reasons to Review Your Life Insurance Needs
You may have purchased life insurance years ago and never gave it a second thought. Or perhaps you don’t have life insurance at all and now you need it. When your life circumstances change, you have a fresh opportunity to make sure the people you love are protected.
Marriage and Life Insurance Planning
When you were single, life insurance may have felt like an unnecessary expense. However, once you are married, someone else depends on your income. Consequently, if something happens to you, your spouse may rely on life insurance benefits to cover everyday expenses and pay off outstanding debts.
The amount of life insurance coverage you need depends on several factors, including your income, debts, assets, long-term financial goals, and personal circumstances. Furthermore, even if you receive low-cost life insurance through your employer, that coverage may not be sufficient. In many cases, purchasing additional life insurance from a private insurer can help close any coverage gaps.
Parenthood and Protecting Your Family
When children enter your life, reviewing your life insurance needs becomes even more important. Therefore, life insurance proceeds can help protect your family’s financial stability by covering current obligations such as a mortgage, child care, and car payments.
Additionally, life insurance can help address future expenses, including a child’s college education. As a result, even if you already have coverage, parenthood is one of the strongest reasons to reassess your policy limits and update beneficiary designations.
Retirement and Ongoing Life Insurance Needs
As you approach retirement, it is wise to reevaluate your need for life insurance. You may assume coverage is no longer necessary once debts are paid and financial security feels within reach. However, many retirees still face financial obligations, including mortgages, student loans, or other ongoing expenses.
Consequently, life insurance protection may remain important if you have not accumulated enough assets to support your family or if you want to replace retirement income after your passing. Moreover, life insurance can serve as a valuable tool for transferring wealth to the next generation, paying estate taxes, or supporting charitable causes. In these situations, maintaining existing coverage or selecting a different type of policy may better align with your goals.
Consumers Understand the Value
Health Changes and Insurance Coverage
Many people worry that their coverage will end if an insurer learns that their health has declined. However, as long as you continue paying premiums, changes in health generally do not affect an existing policy. Furthermore, some policies include accelerated, or living, benefits that may be accessed in the event of a serious or long-term illness.
Additionally, you may be able to purchase extra coverage if your needs increase, especially through group plans offered by an employer during an open enrollment period. Consequently, while buying an individual policy can be more difficult or costly, speaking with an insurance representative can help you understand your available options.
Of course, health changes can also be positive. For example, quitting smoking or losing a significant amount of weight may allow you to qualify for lower premiums. Therefore, it is often worthwhile to review your policy when your health improves.
What Affects Cost and Availability
The cost and availability of coverage depend on several factors, including age, overall health, and the type and amount of protection selected. Consequently, before putting any strategy in place, it is wise to confirm that you are insurable.
As with most financial decisions, purchasing coverage involves certain expenses. Policies commonly include mortality and expense charges, and any guarantees depend on the financial strength and claims-paying ability of the issuing company. Moreover, optional benefits are available at an additional cost and are subject to specific terms, conditions, and limitations.
This information is not intended as tax, legal, investment, or retirement advice or recommendations, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek guidance from an independent tax or legal professional. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Broadridge Advisor Solutions. © 2021 Broadridge Financial Solutions, Inc.