Tips: Review Your Life Insurance Needs

September is Life Insurance Awareness Month. Any time you experience a change in life circumstances, it’s important to take the time to review your life insurance coverage to ensure your loved ones are protected.

Getting married

Now that you’re getting married, your spouse may be depending on your income. The amount of life insurance coverage you need depends on your income, your debts and assets, your financial goals and other personal factors. The cost of an individual policy will be based on your age and health, the amount of coverage you buy, the type of policy (cash value or term) and other variables.

You’ve become a parent

Married, single and stay-at-home parents all need life insurance. Life insurance proceeds can help your family meet both current and future expenses. If you already have life insurance, it’s time to review your policy limits and beneficiary designations.

You’re considering divorce

You’ll want to think about what protection you need, and what protection your children will need in the future. If you’re paying or receiving child support, you may want to use life insurance to ensure continuation of those payments. You may also need to negotiate ownership of life insurance policies.

You’re ready to retire

As you prepare to leave the workforce, you should revisit your life insurance needs. You may need protection if you are still making mortgage payments, paying tuition bills or have other financial obligations, or if you haven’t accumulated sufficient assets to provide for your family. Or perhaps you’re looking for a way to pay your estate tax bill or leave something to your family members or to charity. You may need to keep some of your life insurance in force or even buy a different type of coverage.

Your health has changed

A common worry is that if your health changes, and your insurer finds out, your life insurance coverage will end. But if you’ve been paying your premiums, changes to your health will not matter. In fact, you should take a closer look at your policy to find out if it offers any accelerated (living) benefits that you can access in the event of a serious or long-term illness.

It’s also possible that you’ll be able to buy additional life insurance if you need it, especially if you purchase group insurance through your employer during an open enrollment period. Purchasing an individual policy may be possible, but more difficult and more expensive.

If you’re health has changed for the better (perhaps you’ve stopped smoking or lost a significant amount of weight), you should request a reevaluation of your premium — ask your insurer for more information.

There are a number of life stages that require reevaluation of your life insurance coverage needs. It’s important to periodically review your policy to insure you have the appropriate type and amount of coverage.

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2016.

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