People who take out life insurance tend to be long-term planners, but that doesn’t mean your policy needs to be set in stone—in fact, there are plenty of situations that can warrant revisiting your life insurance coverage. Here are a few cases where you may want to reevaluate your policy.
After a major milestone
Birthdays, weddings, graduations—life has a lot of big events, and many of these are opportune times to revisit your insurance coverage. After all, these tend to be times when your financial needs change. For example, if you took out a term life insurance policy to ensure your children’s college tuition would be paid for even if you passed away, you’ll likely want to reassess your coverage once they graduate.
Or, if you have a second child, you may want to increase your coverage. The same goes for buying a home, getting married, and more. Whenever you or your loved ones hit a big life milestone, see whether a change in insurance coverage might make sense. It can help to speak to a financial advisor or consult your insurance agent.
After a promotion or raise
A big change in earnings can also be a good time to revisit your life insurance policy. Some jobs will offer life insurance coverage for their employees, but you’re only covered for the duration of your employment there, and the coverage is often limited.
After a big promotion, some people decide to increase their individual policy’s coverage or even choose to get a permanent life insurance policy like whole life insurance.
Changing beneficiaries doesn’t mean altering your amount of coverage—but you should regularly revisit who you have listed on your policy. When do you typically change beneficiaries? This can happen relatively often—you’ll want to change your beneficiaries when someone passes away or when you gain a new family member.
While changing beneficiaries doesn’t mean you’re changing how much coverage you have, you may want to take the opportunity to revisit this as well. A shift in beneficiaries often accompanies a shift in priorities.
Making sure your life insurance suits your goals
When it comes down to it, you should revisit your insurance when your needs change. Whether you have more family to look after, or you find yourself making more money than before, priorities can fluctuate and having the appropriate amount of coverage can help ensure peace of mind.
Evaluate where you are in life, as well as your next big personal and financial goals, and see what form of coverage helps you meet them.