Life insurance provides critical protection for your loved ones, giving them the financial resources they need to begin rebuilding if something catastrophic happens. Since your financial situation will change over time, it’s important to update the policy periodically. Below are some signs you should consider reevaluating your life insurance policy.
When to Update Your Life Insurance
Your Financial Circumstances Change
Receiving an inheritance, buying a house, or starting a business often means changes in income and responsibilities. If your net worth is substantially from when you purchased your life insurance, you may need a policy with a higher death benefit. Conversely, paying off a mortgage or retiring may reduce the amount you need.
Marriage & Childbirth
The primary purpose of life insurance is to provide for dependents, so review the policy as your family grows. After a wedding or the birth of a child, you may need to increase benefits to match your new financial responsibilities. Taking in an elderly family member or marrying someone with children from a previous marriage should also trigger a review of your policy.
Divorce & Reduced Responsibilities
Some major life events may result in reduced responsibilities, and your coverage should reflect the new situation. After a divorce, you will likely wish to select a new beneficiary or reduce the benefit altogether. Similarly, as children grow and start careers of their own, they require less financial support and may not need the full amount of coverage you originally purchased.
Whether you’re updating your life insurance coverage or buying a policy for the first time, an experienced agent will provide peace of mind and expert advice. As a member of the State Farm® Chairman Circle, Zach Plackemeier, State Farm Insurance Agent is one of the top professionals in the country. He is known throughout the St. Louis, MO area for designing custom policies tailored to customers’ needs. Visit the website or call (314) 921-7900 to request a quote. Like him on Facebook for regular news and updates.