Many people buy term life insurance only to tuck the paper work in a drawer where it is out of sight, out of mind. This is not a great idea. Even the best term life insurance needs a review now and then. Buying a Term Life Insurance policy is all about peace of mind. You typically buy a policy based on your needs and budget at the time. But...
Pretty soon, even the best Term Life Insurance policy might no longer provide the recommended coverage for your individual situation. So, even if you have a term life insurance policy, here are some things to consider.
Replacing income is one of the biggest reasons people buy Term Life Insurance. Has your income gone up? Have you earned additional investment dividends? Did you get enough coverage to begin with?
When reviewing or buying a term life insurance policy, don't forget to think about your home. After all, it's the most expensive thing most of us will ever buy in life. It makes sense to see that it's protected.
Have you recently purchased or refinanced a home? Will the money your beneficiaries receive from your term life insurance policy be enough to pay off the home, or at least ensure they can continue living there?
If you've just walked down the aisle, it might be time to buy term life insurance to help protect your spouse. If the death of one spouse means leaving the surviving spouse with financial hardship or debts, boosting the coverage could be in order.
Buy term life insurance to care for children and other dependents.
Another major reason people buy term life insurance is to protect people who rely on them for financial support or assistance. Most people think in terms of kids, but it could also mean buying a term life insurance policy to ensure quality of life for a dependent sibling or aging parent who comes to live with you.
If your needs have changed and you decide you need more coverage, one way to buy term life insurance is to layer it. This means buying a new term life policy to complement your existing policy. For example, if you have a policy and then have children, perhaps buying a new term life insurance policy for 20 years to protect them until they are in college may be a sound strategy. Or, you might buy a term life insurance policy for 30 years to protect a new home mortgage. The good news is, you can decide on the term and coverage amounts accordingly.
If you review your term life insurance policy and decide you need additional coverage, another option is to add Accidental Death Insurance. This insurance pays your beneficiaries in the event you die or suffer a traumatic injury in a covered accident. It's a limited benefit type of insurance, but accidental death insurance is good enough for many people who either don't qualify for or cannot afford term life insurance.
To get the best term life insurance advice, talk to a licensed agent. An agent can help assess your needs and provide the information you need to decide if you should buy term life insurance or modify your policy.
Be sure to discuss any changes in your life, your financial goals, and be honest about your budget. The best term life insurance should give you peace of mind for your loved ones and your wallet!