Why should I increase my life insurance coverage?
Well, as your life changes, your insurance needs change with it. Depending on events that have happened and how your mindset has evolved since you first bought a policy, it may be a good idea to make sure you have enough coverage.
1. You Welcomed a New Family Member
Congratulations! You just had a baby and this is one moment that should be treasured. However, with a child comes with responsibilities that will cost you… a lot. According to the U.S. Department of Agriculture, its costs around $233,610 to raise a child and care for him/her till the age of 17.
Then, there’s the cost of putting them through college and taking out a student loan for them. There are numerous factors you need to consider and who does not want to provide the best for their kids? Now imagine that your partner met an accident. It’s a tragic loss, but life must go on and the payout from the life insurance policy will make it easy for you to move on and handle any financial stress.
2. You Bought a House
According to a study by Life Happens, the top reason why people buy a life insurance policy is to cover a home loan and other home expenses. Once you are gone, if the mortgage is not paid in full, your family might be forced to move out of the house. The way life insurance works here is that after you pass away, your family is able to make the monthly payments from the insurance payout.
This money also helps your family members maintain the property and pay taxes for a significant amount of time, until your kids come of age and become independent. Here, you will have to assess your needs, factor in the mortgage amount, and then go for a coverage that provides a cushion against all those costs.
3. You Were Given a Substantial Raise
It seems like congratulations are in order again! You finally got that raise you had been hoping for. Before you head to celebrate this success with your family, we suggest you give a call to your insurance provider first.
Here’s why: since your income has increased, the current terms of your life insurance policy will not cover loss of income. Your family will receive a small payout, which will not be enough to fulfill their needs and wants. This is why you need to change the terms of the policy, which will probably mean paying a higher premium than before.
4. A Change in Your Lifestyle Has Made Your Family Accustomed To Greater Comforts
Since your salary has increased, your family’s lifestyle will change to. They will gradually become accustomed to greater comforts and luxuries. If you find yourself spending more, then you should give the life insurance policy a once over. Bridge this gap and then set goals. A great way to reassess your needs is to talk to your insurance provider and ask for advice on how to provide protection to your family that promises luxury living after you are gone.
5. It Allows You to Plan for the Future
Do you plan to leave a legacy? You might have not thought about this, but your kids are surely depending on it. Another important reason why people increase their life insurance coverage is because they want to leave an inheritance. If you don’t have kids, then why not think about giving it all away to a charity? Your name will live on and a lot of needy people will reap the rewards.
“When the time is right, you will know.” Isn’t that what people say? The slightest change in your lifestyle should have you reevaluating your future plans. It’s better to get your needs assessed by an insurance provider rather than using one of those online insurance calculators online. Think about it — your family will be left wanting for nothing if you keep your life insurance coverage up to date, according to your changing needs. After all, they will be grieving your loss and the payout will help them lessen the burden and move on with their lives.
If you are looking for a qualified insurance agent who holds years of experience in this field, speak with us today. The company provides different types of life insurance policies, which include whole life insurance, term life insurance, guaranteed acceptance life insurance, universal life insurance, and variable universal life. To know more about their policies, contact them at 203-481-8898.
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