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BLOG 07/17/2020

What to do when life insurance needs change

You land that dream job. You find out it’s twins. Life is full of surprises – and as your life changes, do your life insurance needs.

Whether you already have a policy in place or are just starting to think about it, here’s when it’s wise to take another look at your life insurance coverage.

Do I need to change my life insurance?

It all depends on your situation and the life stages you go through. If any of these big changes happen, consider reviewing your coverage:

You Get Married

Starting a new life with your partner is an exciting step, but it also means getting practical. You now have another person depending on your income, and your surviving partner may struggle to pay all the bills alone. Buying or updating your life insurance protects the life you built together and ensures that no one suffers financially if one partner dies. It can also help them pay for bills like final expenses at a time where they’ll need it most.

You Have Kids

It’s no secret that kids are expensive. According to the United States Department of Agriculture (USDA), it costs over $230,000 to raise a child to college age. Whether you’re welcoming your first baby or expanding your family, life insurance is a must. It can give you the coverage you need to take care of your family and help prepare them for future costs, just in case. Learn more about life insurance policies for moms and dads.

You Buy a House

Whether you live with a partner or are still single, you don’t want to saddle your family with mortgage debt, especially if they’re already grieving. The cash payout your loved ones receive after your death can be used for whatever they need: paying down debt, covering bills, or saving for the future.

Your Job Changes

Whether you get a raise or get laid off, a career change means it’s time to take another look at your life insurance. Many people count on group life insurance from their employers, but these policies typically don’t follow you to a new workplace. If you lose your job or switch employers, it may be a good time to buy individual life insurance coverage, which is likely more affordable than you think. A $250,000 term life policy for a healthy 30-year-old starts at just $13 a month, helping you gain peace of mind even if funds are tight.

Also, if you’re going to be earning more than you were before, you may need more life insurance to help your family maintain their lifestyle. In general, it makes sense to buy a policy with coverage equal to seven to 10 times your income.

Every Year

If you already have a policy, it’s smart to do an annual review. Check that your coverage is still sufficient and that the beneficiaries you named are up-to-date and correct.

If you don’t have life insurance yet, these milestones can be a good reminder to take stock of your situation and decide whether coverage is a good idea. Life insurance costs rise as you get older, so it’s better to buy that policy sooner than later.

How can I change my life insurance?

If you’re not covered yet, eFinancial can help. You can compare affordable policies from top-rated companies online, and our specialized agents offer personalized guidance so you can choose the best plan for your unique needs.

If you already have life insurance, talk to your insurance company about your options. They may be able to increase your existing coverage or help you through the process of buying another policy.

Still have questions about your coverage? Get in touch to speak to one of our agents.

 

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.