We all lead such busy lives that it's not always easy to fit in yet another task. However, when it comes to your life insurance, it's important to schedule the time to review your coverage with your agent or company representative on a regular basis. But how often and when?
The National Association of Insurance Commissioners (NAIC) suggests that you regularly consider a life insurance policy review to determine if your coverage is still appropriate for your situation. In fact, most financial advisors and insurance professionals recommend reviewing your life insurance coverage annually. Your agent can help you make necessary policy modifications according to your present needs, as well as examine the potential for changes in the coming years.
A good way to be sure this important task gets on your “to-do” list, is when your life insurance policy comes up for renewal. Not only can your life insurance renewal serve as a reminder, but because most insurers generally send out renewal notices at least 30-days in advance (some even earlier), you'll have plenty of time to speak with your agent or company representative to make any changes to your existing policy.
However, there may be times during the year when specific life changes just can't (and shouldn't) wait until your policy renews. According to the Insurance Information Institute, some types of life changes may include:1
- A new marriage or divorce
- A new child or grandchild who is born or adopted
- Any significant changes in your health or that of your spouse/domestic partner
- Assuming the financial responsibility of an aging parent
- A new home purchase
- A loved one who may require long-term care
- When you refinancing your home
- Coming into an inheritance
Your life insurance policy was never meant to be a set-it-and-forget-it document. By regularly reviewing your life insurance plan with a professional, you help ensure that your policy remains up to date and that you have adequate life coverage over the long-term for your loved ones.