5 Reasons to Review Your Life Insurance
Kriti had all her family members insured. She thought having insurance in place will protect her family in times of financial emergency.
Her brother got in an accident.
She applied for insurance but was denied the claim based on some technicalities.
At that time, she realized the importance of reviewing the insurance policies from time to time.
She has been reading about it avidly, and now she is ready to impart some knowledge, which is as follows;
Why think about reviewing your Life Insurance?
When you think about why buying life insurance is important, you generally think about protecting your family and loved ones during financially straining situations when you pass.
You can help ensure financial support for those who matter the most. Reviewing your life insurance every year helps you make sure that your policies are up to date. As your age increases, there are always reasons for which you would need better insurance policies in place, for better protection.
If you choose to add additional coverage, most of the time, you will need to apply for and then purchase a new policy. This is why you need to review and make changes in your current policy if needed.
5 reasons to think about reviewing your insurance
Change in Lifestyle
Insurance companies usually ask you to undergo a series of tests before you are issued an insurance policy. In some cases, if you don’t meet the health parameters, the policy premium is increased accordingly, in an account of the higher risk you may carry.
If there is a gradual change in your health and lifestyle, then you would need life insurance that can keep up with your changing needs. Reviewing both health and life insurance plans will help you financially get equipped in case of any medical emergencies and or life events.
This would eventually help you experience the perks of a good lifestyle without worrying about being sufficiently insured.
Everything today is getting costlier. Healthcare gets more expensive every year. What seemed like the adequate medical cover a few years ago, will most probably be not enough in today’s times, or will become inadequate in some time.
Your life insurance policy should have good coverage so that you don’t have to worry about your family being secured in your absence. Reviewing your existing insurance plan, therefore, becomes necessary to ensure this thing as well.
The increasing expenses demand an increase in the life insurance portfolio which also signifies the need for a review of your insurance.
Change in levels of Income
Any kind of change in the levels of income, whether increase or decrease, is also one of the factors that would impact the need for reviewing your insurance.
In case of a rise in your current salary, opting for a higher sum assured plan could be beneficial as it would ensure more coverage and also higher financial security during the case of emergencies.
In the case of a pay cut, reviewing makes more sense, as to opt for a lower sum assured rather than surrendering the policy.
Due to a change in circumstances, you have taken a loan. Buying a house can be a life-long commitment. If you leave your family with the responsibility of paying for the home loan, it cannot always be considered a good idea.
With this sudden financial strain put on your family, the repression of the property by the lender, in case of non-payment of EMIs is more likely to happen.
To save your loved ones from such a situation, you need to safeguard their lives financially. You need to make sure that your life insurance offers a pay-out greater than the sum of all your debts. Thus, in this case, reviewing seems like a really good idea.
Starting a family
Having a family is something that humans desire after a certain age. Change in goals after having your own family is a very common thing to have. When you own the responsibility of becoming parents to kids, you are burdened with additional financial expenses.
Your children would grow up and you would need insurance which can prove to be sufficient for fulfilling their educational goals. If your child opts for higher education, a savings insurance policy can help you out in achieving these goals without any strain or difficulty.
When your child becomes financially independent and doesn’t need your support, you can always opt for a lower premium plan.
People think that reviewing an insurance policy can be a very difficult task. If you have a clear savings plan already in place, you can just make a few changes to suit your current situation. There are a few basic things that you need to keep in mind to make your insurance policy more suitable for your current setting in place.
People usually consider buying insurance as the ultimate goal. However, reviewing the plan regularly is also very essential to help you understand whether the purchased plan now works for you or needs an upgrade.
What kind of upgrade would you need?
Being in control of your finances can always help you understand if you need a better insurance plan or the current one works just fine. Be cautious of your finances and it may keep you in a loop.
Will the upgrade be costly?
Most of the times people think that changing their insurance plans will cost them extra, but that is not the case. If your insurance plans align perfectly with your financial needs, they will always benefit you in the right manner.