So, you purchased a life insurance policy. Now your family is set and financially secure. That should be the end of it, right? Unfortunately, that isn't the case.
It's recommended that you review your life insurance policy every year. Life brings about a lot of changes, and adjustments in your policy need to be made in response. If your health improves or if your insurance rates are too high, there might be an opportunity to save by switching insurance carriers. Reviewing your insurance policy every year allows you to possibly shop for cheaper prices. Here are the big reasons you should check your policy each year.
If you make drastic lifestyle changes, review your policy and notify your insurance agent. This could include expanding your family, kids going to college, moving to a larger, more expensive home, moving to a new city or state and a major increase to your annual income with a job change or promotion.
Insurance Needs Change
You won't always need the same amount of coverage. As with any other type of insurance, your coverage needs change. As your family grows and your assets increase, more coverage may be needed to ensure you are not under-insured.
Changes In Health
Any change in your health is important to note. It's just as important to review your policy. Many term life insurance policies can convert into whole life policies. Improvement in health — such as weight loss, controlling elevated blood pressure, cholesterol and A1C with lifestyle changes and regular medication — can qualify you for lower rates and save you money. If you quit smoking, it's possible to stop paying as much on your life insurance premiums as you were when smoking. The same can be said for reducing other personal risks.
Do Term Life Insurance Premiums Go Up Every Year?
Since term life insurance extends over a certain number of guaranteed years, you pay the same premiums for however long you chose to set the term policy, regardless of any changes in health or lifestyle. Term life policies usually have guaranteed level premiums. This does mean, however, that once the term ends, premiums for life insurance will explode dramatically.
Reviewing your policy on an annual basis with an experienced, licensed Life Insurance specialist allows you to shop for cheaper rates for your coverage needs and ensure you are not under-insured.