Should you update your family life insurance policies?
We get it. Between work, school, kids, and everything in-between, it can be a challenge to get everything you need checked off your “to-do” list by the end of the week. And while you may already understand the importance of keeping your family life insurance policies up to date, does it continue to take a backseat to other priorities?
If you're not setting aside the time to review and update your life insurance policies because you think it's a long and drawn out process that will take an entire day to complete - think again. Of course, just how long it may take you depends on what you're trying to accomplish. Two things that people may need to update from time to time are their beneficiaries and death benefit.
Reviewing beneficiaries
Have you gotten married, remarried, or been recently divorced? Did you have a new baby or adopt a child? These are common reasons why you should review the beneficiaries on your life insurance policy.
Typically, you can update a beneficiary by simply contacting your insurance agent or life insurance company representative and filling out a form that will amend your policy. Most insurers have representatives who can get you the requested form by email, fax, or the U.S. Postal Service.
Increasing your coverage
There are a number of reasons why you may need to increase your life insurance policy's death benefit (a new marriage, a growing family, an increase in assets, etc.). Start by asking yourself if you were to die today, would your family suffer financially? If you're unsure how to answer that question, then pull out your policy and contact your agent or life insurance company representative who can work with you to crunch the numbers and give you a better estimate of how much you may need to increase your coverage to adequately protect your family.
This is often determined by way of a life insurance detailed needs analysis (DNA). A DNA works by carefully considering your individual needs and obligations, as well as your current assets, then providing you with a calculated snapshot of how much life insurance you may need to meet your family's needs. Completing a DNA is typically a quick process and once you know your numbers, your agent or company representative can provide you with options for taking the next step to increase your coverage, if necessary. Another option is to plug your information into Protective Needs Calculator and in a matter of a few steps you will have a figure to get you started.
The most important takeaway here is not to wait. If you've had changes in your life and your family over the past year, then take a few minutes to assess whether or not an update to your life insurance policy is in order.
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