Life insurance is the protection we buy for our loved ones. It’s the gift we give them so we don’t have to worry they will be overburdened later on. Unfortunately, once we buy a policy, we tend to forget about it, not realizing adjustments need to be made to it as our circumstances change. In re-evaluating our insurance requirements, we have to rethink, “How much life insurance do I need?” It’s important to periodically review your situation to see if a change in insurance may be warranted. Here are six important factors you may want to consider.
Your Indebtedness Has Significantly Increased
Although you may have initially taken a life insurance policy out so you could provide for your loved ones, you may not realize your debts can create a drain on their resources. If you’ve taken on student loans or a mortgage since you took out your policy, you’ll want to consider how much you’ll need to increase your insurance to cover that debt in the event you pass on before the debts are paid. Contact your independent insurance agent to get life insurance quotes for the appropriate increase in coverage. Your agent can work with you to help determine whether it’s better to replace your current policy or to simply purchase additional coverage.
Your Mortgage Is Paid Off Early
If you’ve purchased a 30-year term life policy to cover your 30-year mortgage, but you’ve paid off your home early, you may have a policy you no longer need. Take complete stock of your finances to determine if you still need the additional coverage. If not, you may want to consider cancelling the policy, or you may want to talk it over with your agent to see if the benefit amount can be reduced.
Your Number of Dependents Has Changed
If you are married and have children, most likely your policy only shows your spouse as beneficiary. In the event something should happen to you and your spouse at the same time, you should think about adding your children as contingent beneficiaries. You may want to also consider increasing your coverage to take care of their college educations. Get with your agent to compare life insurance rates in Dallas, to help you with the decision of whether to replace your existing policy or add a new one.
Your Dependent Becomes Disabled
If your child becomes disabled, you’ll want to ensure you provide for them in the long term. The longest term policy is just 30 years so you’ll want to invest in a permanent policy with longer coverage.
You Have an Older Policy
If you purchased your policy prior to 2009, you may want to contact your independent insurance agent for new life insurance quotes for your coverage. Prior to 2009, insurance companies utilized 1980 mortality tables, but in 2009 were mandated to switch to mortality tables from 2001. The difference is the 2001 tables show we now are living longer. The result is having your agent re-evaluate and compare rates to save you money.
Your Insurance Company Disappoints You
If your insurance company’s financial rating has been downgraded and you want to ensure they can continue to cover your policy, talk to an independent insurance agent. They can be invaluable in helping you decide whether you should move to another insurer. If you need help with life insurance rates in Dallas, contact us. When you have big changes in your life, our agents can help with your insurance decisions.