Have You Reviewed Your Life Insurance Coverage Recently?

Many of us have some form of Life Insurance in force — whether it’s your group coverage through work or a personal plan you purchased at some point. What tends to happen is that once we buy it, the general thought is that, “I have life insurance,” so that is one less thing I need to worry about. Not necessarily the case.

When we buy life insurance, we do so for a few main reasons — replacement of income, debt reduction, final expenses etc. When we die, we want to ensure our family is looked after. What happens with all of those examples is that they fluctuate.

We either pay down debt, increase debt, or our income hopefully increases over time.

Final expenses will increase as time goes by. So what you purchased 5,10 or 15 years ago may not give you the adequate amount that your loved ones depend on.

With that said, it makes it all that much more important to have regular reviews on your coverages and life situation. It’s surprising how many people basically pick a number for a coverage amount without even putting much thought into how far that money will go.

I’ll use this as an example: $500,000 is a lot of money, right? Let’s say I purchase a policy to cover me for that amount. My family should be just fine with that amount of cash. What I’ve forgot to think about was I have a $350,000 mortgage, line of credit of $15,000/$20,000 vehicle, daycare costs of $12,000 and my funeral will cost $10,000. All of that $407,000 cost is not going to disappear when I’m gone. So basically I’m leaving my spouse with $93,000 to live on. Not even 1 full year of income to support the family. With the general rule of thumb being 10 years lost salary, it looks as though I’ve left them a little short. Would you agree?

My point is that without putting much thought into how you come up with your coverage amount or not updating your coverage, you run the risk of leaving your family in financial stress.

Don’t be the person who shuts off the switch once they get some level of coverage. Stay on top of it by meeting with an advisor, and be open to changes in your life situation to ensure you are receiving adequate affordable coverage.

Make sure you have the right coverage for your needs. Call Heritage Insurance at (306) 693-7640 for more information on Moose Jaw life insurance.

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