Changing your Life Insurance to Suit your Needs
It's been estimated that around 75% of Americans have life insurance-but a large proportion of those who are insured have insufficient coverage. It's not enough to simply have the insurance any more. These days it's just as important to make sure that your insurance meets the needs of your particular life stage. Your insurance needs will change over the course of your life so it's important to review your policy periodically to make sure that your policy is appropriate and that you're adequately covered.
Insurance for Newly-weds
If you've just gotten married and you're not planning to have children for a few years, then you may want to consider short-term life insurance for you and your partner-term life insurance is typically cheaper than permanent or whole life insurance, particularly when you're young and healthy, so it's a good option for young people who may not have much money to spare for insurance premiums. If you've decided that you'll wait a certain amount of time before having children, then getting term-life policies to cover you until then is a good idea. Then once you start having kids, it's time to think about reviewing your policies and making some changes.
When you start having children, you'll likely need to increase the value of your insurance policy. If you or your partner should die or be permanently disabled to the extent that working is no longer possible, life insurance will help ensure that the family remains financially stable.
If you get Divorced
If your marriage ends, you'll probably want to make changes to your policy. For example, if divorce means you no longer have any dependents you may decide that you no longer need life insurance. If you have children, you may want to change the beneficiaries of your policy to include your kids rather than your ex-partner. This is easy to do, and you'll be able to add all your children as beneficiaries, so that if they must make a claim on the policy the money will be split evenly between them.
As you near retirement age, not only will you be growing older, your kids will too. Even if you're still married, you may want to consider adding your children as beneficiaries in addition to your partner-this is entirely up to you, and will depend on the age of your children and how financially stable your partner will be if you die. You may also consider reducing the value of your life insurance policy.
Throughout the course of your life, you'll go through other lifestyle changes in addition to getting married or having children that will affect your insurance needs. If you have a high-risk lifestyle-for example if you are employed in a hazardous job, are a smoker or are overweight or have other health problems, your insurance premiums will be higher. However, if you reduce your lifestyle risks and maintain that reduction for a significant period of time, you'll qualify for a premium reduction.