Why Review Your Current Life Insurance Policy?

A lot of people think that once they buy a life insurance policy, their work is over and they never have to think about it again. However, life circumstances change, and it's a good idea to review your current life insurance policy at least once a year. A good look at your plan may show you some areas where you can make changes- here are some guidelines to follow to know when (and why) you should review your life coverage.

*If your income has changed, that's a good time to re-evaluate your insurance needs. Perhaps you've just finished college, or gotten a good job with a benefits package. Or, you've been promoted and gotten a raise, or lost your job. Any of these circumstances warrant a review of your life insurance policy, to ensure that it's still meeting your needs.

*Changes in health can be a cue to re-work your policy as well. For instance, if you've been eating right and exercising and your blood pressure has dropped, you could qualify for a lower rate. Insurers generally reward those in good health with lower premiums; call your insurer and ask what kind of rate you can get as far as a good health discount is concerned. The opposite is also true; declining health can mean an increase in premium.

*If your family status has changed, you will want to rethink your coverage needs. Those expecting a new addition to the family often face increased pressure to provide a safety net for their children. Even those with older children should review their policy; parents with college-age children should have a plan in place to finance their education if something unfortunate happens.

*Changes in your housing status. For example, if you've paid off your mortgage, you may not see a need for such a big policy. Or, you've just bought your first home and need to have a plan for paying for it in the event of a catastrophe. When your housing status changes, your insurance needs may be more or less, so review your policy at that time.

*Changes in marital status are an excellent time to review your current life insurance policy. A new marriage or a divorce usually brings about changes in a person's life insurance needs. Changes in beneficiaries can bring about a need for a review; after all, you'll want to ensure that your new spouse is your beneficiary, while your ex-spouse is excluded.

Talking about life insurance is never fun- after all, no one wants to think about what will happen after they are gone. However, it's a necessary part of life. The above are all good reasons why you should review your current life insurance policy, and in your own life, you can probably come up with a few more.