Why You Should Review Your Life Insurance Policy Regularly

Do you have a set time to review your life insurance policy each year? Life insurance is a staple within your family’s financial strategy, so you want to make sure that your policy is in order. The following are things you should review each year to ensure your policy allocation is right.

Beneficiaries

As the owner of your life insurance policy, you get to determine who receives the proceeds of your policy. You get to choose your beneficiaries. Life happens, and the person you originally chose to be the beneficiary of your policy may have changed. Or, you may want to add another person if you’ve had a child. By reviewing your policy annually, you ensure that your policy goes to the right person or persons.

Policy Limits

There are many different life changes that can affect how much insurance you need each year. Losing a job, gaining a mortgage or having a baby are all important factors in determining how much life insurance you should maintain from year to year. All too often, any one of these life events may happen and a policy owner finds they are underinsured when they really need their policy to be accurate. Reviewing your policy with your independent insurance agent will help you determine what amount of coverage is best for you at any given point in your life.

Review Policy Specifics

There are many types of insurance policies available. From term life to whole life to universal life insurance, it’s important that you know how your insurance policy works. The National Association of Insurance Commissioners (NAIC) recommends that policy owners review the following specifically:

• Whether your premiums or benefits vary each year
• How benefits accumulate each year
• How interest affects monies paid and received from a policy
• How you can access cash values
• If you can convert your policy

All of these policy-related details may not be on your radar, so it is important to review your insurance policy with your agent. He or she will help you determine whether your life insurance policy can help you reach your financial objectives.