Many people believe that once they have secured a life insurance policy there is little need to review or change the policy. In fact, many people tend to think that once they have opted for a policy it can’t be changed even if they wanted it to be.
This isn’t the case. One can, in fact, review and make changes to their policy whenever they want whether that be on a term life insurance policy, a whole life policy, or an investment-linked insurance policy.
Regularly reviewing your life insurance policy is something that all policyholders should do to ensure that their policy meets their evolving needs and provides the necessary financial protection needed through different stages of life.
In this article, we will look at what a life insurance review entails and when changes to your insurance policy may be warranted.
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What Does A Life Insurance Review Entail?
Life insurance policies aren’t set in stone. They can be altered and adjusted to adapt to your changing life circumstances.
These slight adjustments to a policy can make all the difference when it comes to getting optimal coverage and the process of doing this is referred to as a life insurance policy review.
As you go through different phases of life you must adjust your policy to ensure you have the right level of coverage terms at the right price. This means calculating how much coverage you have vs. how much you need, making changes to beneficiaries, or adding riders to your existing policy.
As such, it is recommended that a review of your life insurance policy should be done once every year.
6 Reasons Why You Should Regularly Review Your Life Insurance Policy
There are several reasons or scenarios in which a review of your life insurance policy may prove to be quite beneficial.
- Life Changes
It is natural that as you go through various stages of life your financial and family situation will change over time. Marriage, divorce, the birth of a child, a career change, and other life changes can all have an impact on the type of coverage you need. Regularly reviewing your policy will make it easier for you to align your policy terms with your current life stage needs.
- Addition Of Riders and Other Options
Several types of insurance riders can be added to an existing policy to enhance its coverage.
Popular types of riders include coverage for critical illness, chronic health conditions, accidental death, family income benefit, return of premium life insurance, waiver of premium rider, and guaranteed insurability rider.
Each one of these riders offers a layer of additional protection to your policy and can be advantageous to add at different stages of life.
By regularly reviewing your life insurance policy you can make more informed decisions of when to avail the benefits that these riders can provide to get the best coverage for your needs.
- Lowering Premiums
Another big reason to regularly review your policy is to ensure that you are getting the most value for the premiums you are paying. By understanding your coverage terms you can potentially find ways to save on premium costs. This can be done by changing your coverage amount or taking advantage of offers and discounts.
- Adjusting To Evolving Financial Goals
Just as you go through life changes your financial goals may also change as you age. As you progress in your career you may find opportunities to start a business, travel, or pursue philanthropy which may warrant a review of your life insurance policy.
- Updating Beneficiary Information
Births, deaths, divorces, and changes in relationships can all have an impact on who is listed as a beneficiary on your life insurance policy. Reviewing your policy regularly can help ensure the right people are listed as beneficiaries on your policy.
- Tax Implications
Changing financial situations can have tax implications which can impact the way your life insurance policy is treated. Reviewing your policy with experts can help ensure that your policy isn’t impacted by changing tax laws and regulations, and if it is, to be adjusted accordingly.
Frequently Asked Questions (FAQs)
Q) How often should you review your life insurance policy?
It is recommended to review your life insurance policy annually, especially if you have an investment-linked insurance policy. For term and whole insurance, you should review the policy any time a significant life event occurs.
Q) What happens if you don’t review your policy?
Not reviewing your policy regularly can lead to many complications. Your original coverage may no longer be adequate for your current situation or the beneficiaries listed on your policy may no longer be applicable for receiving entitled death benefits.
Q) Is there any cost associated with policy reviews?
In most cases, policy reviews are free of cost and provided as a complimentary service by your insurance provider.
Protect What Matters Most With McIver Insurance Inc.
Whether you have a term life insurance, whole life insurance, or an investment-linked life insurance policy you should make it a point to review it as often as you can to ensure the terms and conditions of your policy, its premiums, and its coverage amount stay relevant to your current needs.
The best way to review your life insurance policy is with a trusted life insurance advisor. These are the experts who can help you understand the different aspects of a life insurance policy and how certain factors could impact your current and future financial goals.
At McIver Insurance Inc. our insurance advisors work diligently to ensure that your life insurance policy is tailored to your specific needs and financial goals. Whether you are looking for an individual life insurance policy, a group benefits plan, or simply want to review your current policy we are here to help.
For more information or to book a meeting call us now at 1-902-220-3279 or email [email protected]. You can also stop by our office located at 90 Lovett Lake Court, Halifax, NS.