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Purchasing multiple life insurance policies

Sep 18, 2020 3 Minute Read

When it comes to life insurance, are you fully covered? According to one recent study, 43% of life insurance owners say they either don’t have enough coverage or aren’t sure if their coverage is adequate.

In some cases, the solution may be owning two (or more) life insurance policies instead of just one. This strategy is called laddering policies, and it can help you tap into extra financial protection in an affordable way.

So is more actually more with life insurance? Here’s what to know about laddering policies with insurance providers.

Can I have multiple life insurance policies?

There’s no limit on the number of life insurance policies you can buy from insurance providers, as long as you’re eligible and approved for coverage by your life insurance company. You’ll need to show you that you have an insurable interest – like kids to support or a mortgage – and that you can afford the monthly premium payments.

But why would you want to buy multiple life insurance policies? Simply put, life changes. People get married, have children, get promoted – and their financial needs change, too.

Since term life insurance comes in different lengths and coverage amounts, buying multiple term life insurance policies can help you customize coverage to meet needs right now and in the future. Here’s how it can work for you:

Example 1: Laddering two policies at the same time

You just got married, had a baby, and bought a house (congratulations!). You buy a $250,000 30-year policy to cover your mortgage in case you die suddenly, and a $250,000 20-year policy to cover expenses for your child until they’re out of the house. This approach means you’ll have $500,000 in total coverage during the years you’re raising your child, typically for a lower cost than buying a $500,000 30-year policy.

Example 2: Adding a policy later

You bought a $250,000 30-year term policy 10 years ago. Now, you’re welcoming a new baby and you need some additional protection. Rather than trying to increase your original policy size, which would increase your life insurance premiums, you add another $250,000 20-year policy. That means you’ll have $500,000 in total coverage for the next 20 years to cover expenses like your child’s food, clothes, and college education.

One note: Life insurance costs go up as you get older. If you put off buying life insurance, you also run the risk of developing a health condition that would prevent you from getting covered. When you’re planning your life insurance purchase, make sure to consider both current and future needs.

Keep in mind that when it comes to adding insurance riders to multiple insurance policies, you won’t be able to split a rider. For example, if you have two policies, you’ll need to pick which one you’d like to apply the rider to. You can read more about life insurance riders on our website, or you can talk to one of our dedicated agents about what works best for your needs.

Laddering policies, made simple

When it comes to protecting your family, laddering life insurance policies might be the best fit for your peace of mind – and your wallet. eFinancial is here to help. Get a quote online, or give one of our agents a call today.


At eFinancial, our goal is to make life insurance simple, affordable, and understandable for everyday families. This content is intended for educational purposes only. Each post is carefully fact-checked, reviewed and updated regularly to ensure the information is as relevant as possible.