The Significance Of Reviewing Your Life Insurance Policy

Why is it important to review your life insurance? When reviewing your home insurance policies, e.g. home or car insurance, you most likely do it at least once a year, right?

Once the annual renewal notice approaches, one of the most practical and simplest options is to feed your information into a comparison site, ensuring that you record any changes in situations that might have happened in the past year. That way, you can compare a wide range of policies to find out whether you might change to one that will increase your savings on your annual premium.

Mostly, people make this a common practice with their other insurance policies. So, why are you not doing the same thing with your life insurance? Has your life changed? Home, kids? Losing a job? Get the right coverage you need. Checking in with yourself whether the policy still aligns with your life objectives.

Life Happens

Since home and car insurance typically last for about 12 months, you will receive a renewal notice every year. Therefore, it is pretty straightforward to review this whenever you get your letter.

Typically, life insurance policies last for about 20-30 years. For this reason, it is understandable that it might not be something you think about daily. If you want to remain on top of it, you will have to be more self-disciplined when it comes to reviewing your policy.

As you already know, life changes frequently for most of us. Because of this, it would be prudent to review your life insurance coverage regularly, in a similar way that you could with your other policies. Although there might be years that pass where not a lot has changed, and your cover is adequate – it is still worth knowing for certain!

Having said that, there might be other situations when you have some crucial life changes which might affect your overall financial future. Therefore, you will need to ensure that you still have a suitable cover in place.

Planning Ahead

Below is a list of events that will need a reevaluation of your life insurance requirements:

– Retirement
– Changing jobs
– The birth of your child or grandchild
– Getting married
– Purchasing your first house or relocating to a different property

In all the above circumstances, you should plan ahead and make a few changes to your life insurance appropriately. However, do not forget about events which might come unexpectedly – for example, having to attend to a sick relative or losing your job.

Any of the above life events might use up a huge amount of your savings and might affect the amount of cover required compared to when you initially took out your policy. If you take a stocktake of your life regularly, you could easily be prepared for these changes. What’s more, it would be prudent to assess your insurance coverage as soon as possible in the event of unexpected events. That will ensure that you have sufficient coverage for the change in your situation.

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