Life does not remain the same, and your life insurance policy should not either. Big life events like marriage, children or buying a home will have an impact on your finances, and therefore, should be reflected in your life insurance policy.
Life does not remain the same, and your life insurance policy should not either. Big life events like marriage, children or buying a home will have an impact on your finances, and therefore, should be reflected in your life insurance policy. This is why it is important to sit down and review your life insurance from time to time. Regular reviews will ensure that your beneficiaries receive adequate coverage to tide them over if something were to happen to you.
Life Insurance reviews: How frequent should they be?
Is there a magic number that determines how frequently you must review your life insurance requirements? Financial advisors recommend looking through your life insurance plan at least once a year. If there have been no big life changing events over the past 12 months, chances are that your current policy will largely remain the same. Nevertheless, changes will have to be made every few years anyway. By conducting a yearly review of your life insurance policy requirements, you can not only modify your current coverage but also examine it in the context of your future plans and prepare for necessary changes in the coming years.
Assess coverage requirements after life changing events:
A number of factors could affect your life insurance needs. The birth of a grandchild, sending your kids to college and taking care of an ailing parent are all events that could eat into your savings. On the other hand, Lady Luck could shine down on you: you could come into an inheritance or your business could take off in a big way. Regardless of whether the events in your life generate less or more income, so long as the events occur, your life coverage needs would change. You may even want to consider whether to buy higher life coverage or divert your money into profitable investments.
Factors to consider while reviewing your Life Insurance Plan:
The author is CEO of MyInsuranceClub.com and can be reach at firstname.lastname@example.org
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