While many consumers don't think twice about it, they should be reviewing their life insurance policies at least once a year, according to financial news website The Street.
Many policyholders will purchase a policy and then set it aside for decades, reported the website, an unwise idea since the industry has made considerable changes over the years. Consumers risk overpaying or even lapsing on a policy if they do not stay up-to-date on its terms.
Kevin Kimvrough, a representative of Saybrus Partners, told the site that many people buy a policy and then put in a drawer to collect dust. Ignoring a plan can be harmful for a beneficiary, who may find that it is insufficient by the time is actually put to use.
"If you don't review your insurance policy, it could run out before you do," Kimvrough said.
The source said when reviewing a policy a consumer should consider factors such as whether they need to change their coverage amount, add a long-term care rider, or add a beneficiary. Policyholders should also ask themselves if they have taken advantage of a plan's cash value and accumulation capabilities, reported the site.
Informing a beneficiary of a policy's existence may also be one of the most important thing a consumer could do. According to the New York Times, millions of dollars worth of life insurance goes unclaimed each year because insurers are unable to locate a beneficiary.