Why should life insurance policies be reviewed?

A life insurance policy review can accomplish several things. When properly done a review can uncover things about your existing coverage that you may not be aware of…and might not like. On the other hand, it can also serve to assure you that you’re properly protected.

A lot of people I talk to on a daily basis have life insurance in place. Very few of them know the basics of their coverage though. Simple things like which carrier (ie. insurance company), type of policy, any upcoming changes to the cost of premiums or amount of coverage are just a few of the questions many people can’t answer.

This is why I offer free policy reviews. To make sure that what you have in place is the right fit, that you’re not overpaying and that there are no nasty surprises waiting for you. We do this together with your insurance company on the phone so I can ask them very specific questions. That way you get everything from the horse’s mouth…not from me trying to sell you something you might not need.

Life changes often mean different insurance needs

Most of our lives change over time, which often means that our coverage needs may change as well. Some of the top reasons I see that prompt a re-evaluation are:

• Job change which resulted increased cost of company-sponsored life insurance…if keeping the coverage was even an option
• New mortgage that needs to be protected
• Marriage
• Divorce
• Additions/changes to the family
• Starting a business
• Closing down or selling a business
• Health improvements since getting existing coverage
• Quitting cigarettes or other tobacco/nicotine products

The insurance market is constantly changing

Another reason to have a life insurance review is that insurance companies revise their offerings from time-to-time. New products come to market regularly, so there may very well be a better option for you out there in terms of cost and/or features.

In some cases, you can think of it like refinancing the mortgage on your house to take advantage of better interest rates compared to when you took out your current mortgage.

Typical issues found during a policy review

Your policy review may not uncover any problems. If that’s the case, you get peace of mind that the coverage you have is appropriate for your needs and that you’re getting the best price available to you in the current market.

On the other hand, a policy review could uncover things you didn’t know about your coverage. Something that may have even affected your decision to buy that particular policy when it was originally offered to you.

The most common issues I see when conducting a review are:

• Term policies that were sold as “permanent” coverage
• Term policies about to expire…with the option to continue at huge price increases
• Policies that have lapsed
• Universal life policies were the increasing “cost of insurance” cannibalized the cash value over the years…which leads to increased monthly premium costs or eventual lapse
• Whole life or universal life policies with loans on them that are accruing significant interest, which reduces the death benefit
• Policies with death benefit amounts set to decrease once or multiple times over the life of the coverage
• Policies with premium payments set to increase in the future, often at an age where most people’s income decreases
• Policies with post-claim underwriting, where the insured’s health and medical history (among other things) are examined AFTER a death claim is filed. This is often seen in what’s advertised as ‘Mortgage Protection Life Insurance‘ and gives companies the right to look for reasons not to pay a death claim.

How to get your free life insurance policy review

Reach out to me directly if you’re interested in comparing your existing life insurance coverage with what’s available to you in today’s market. You can either call me at 512-922-1273, email me at danny@gallantlifeinsurance.com or complete the request form on this page (click Request a Quote or Get Quotes button on mobile).

-Danny Gallant
Licensed Advisor