Depending on whether you have a term life insurance policy or a permanent one, you and your family might be covered for a specific period of years. On the other hand, you could be covered for the rest of your life. However, if you have had your current insurance policy for a few years, you might want to take a good look at your life insurance coverage. It may no longer be enough.
The experts at Lincoln Heritage agree that as your life goes through major changes, your insurance coverage needs to change. If there have been major changes in your life, the coverage you bought years ago may no longer be enough. Such changes might include marriage, having children, buying a home, even continued promotions at work. Therefore, consider these five signs that you may need to increase your life insurance coverage.
1. You Are Getting Older
Many people consider increasing their coverage as they get older. This can be a good way to leave a legacy or inheritance for your family. Additionally, sufficient life insurance coverage can protect your spouse financially in the event of your demise.
2. You’ve Made a Lifestyle Change
Maybe you’ve changed jobs and your income has increased significantly. Or perhaps you have finally paid off your home. Anything that causes a change of income can be a good reason to adjust your life insurance coverage.
3. Major Changes to Your Income
If the business you own has grown and prospered over the years, you need to review your life insurance coverage. Likewise, if job changes or promotions have brought you significant financial success, you should review your coverage. For most people, life insurance is intended to replace lost income for their survivors. Therefore, it is important that your insurance coverage maintains the same level as your current income.
4. You Buy a New House
Even if you have a policy in place that covered the mortgage on your previous home, chances are good that it isn’t enough to cover the mortgage on your new one. Whether this is your first home or an upgraded one, you need to make sure your life insurance coverage will provide for the monthly mortgage payments if nothing else. Of course, making sure you have enough to cover living expenses for a period of time makes an even better decision.
5. New Additions to the Family
One of the most common reasons for increasing your insurance coverage is the addition of a new member to your family. Imagine what would happen to your family if you don’t have enough life insurance coverage to keep things going after you have passed. Better to check your coverage now than have your family find out later that they can no longer afford to stay in the family home or must choose between living in the family home and eating.
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According to a study by the U.S. Department of Agriculture, it costs approximately $235,000 to raise a single child today. And this does not include the cost of sending them to college. It only takes a few moments to review your current policy. Make sure you have the right type of policy and sufficient life insurance coverage in the event of your death.
Life insurance companies like Lincoln Heritage have agents who can help you determine if you have enough coverage. Likewise, they can help you if you need to consider making an adjustment to it.