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Navigating Life Insurance

Why Should I Review My Life Insurance?

When you think about why buying life insurance is important, you probably think of financially protecting your family and loved ones in your life when you pass away. With life insurance in place, you can help ensure financial support for those that matter most. But have you spent time reviewing your life policy and ensuring it still meets your needs since purchasing it?

Having the right coverage in place means less for you — and those you care for — to worry about. That’s why we recommend an annual life insurance review. Because so much can happen in 12 short months, it's important to make sure your policy is right for you and your family today.

To get you started, we’ve put together a list of 10 key reasons why you should review your life policies every year.


10 Reasons to Review Your Life Insurance Policies Annually

Reviewing your life insurance every year helps make sure your policies are up to date and that additional coverage is added if needed. If you do choose to add additional coverage, in most cases you’ll need to apply for — and then purchase — a new policy. Because term and whole life insurance premiums typically increase as you age, the new rate may be higher for the additional policy.

Use the opportunity to adjust coverage to your needs or make changes to any details on file. This brings us to the number one reason you should annually review your life insurance:

1. To review or change your beneficiaries

Your beneficiaries are the people or entities you’ve selected to receive your life insurance benefit.

Your annual life insurance review should always include a beneficiary checkup. Take this opportunity to add, remove or change your designations due to any big life events (e.g., birth, marriage, divorce) that occurred over the past year or any changes in how you wish the proceeds from the life insurance death benefit to be distributed. Doing so will help make the claims process easier when your loved ones need it most.

2. Your family has grown

As you welcome new members to the family, it's important to update your life insurance. From final expenses to loss of income, your coverage should always meet your growing needs.

You may also want to consider a DreamSecure Children’s Whole Life Insurance policy. With it, your child will have coverage that can be added to as they grow.*

3. You started a new job

In the pursuit of your dreams, landing a job you've been hoping for is a big step. The right opportunity can open many doors and bring you closer to bigger goals.

After a promotion, or when you start a new job, check in with your agent to make sure your policy still meets your needs. It's important to account for extra income and any changes in your employer-based life insurance policy, too.

4.You’re starting a new business

Whether you’ve opened a new online store or launched a brick-and-mortar commercial venture, your big investments probably came with a big loan, or may be the result of a large personal contribution.

If you had earmarked the savings you’ve since invested for inheritance, an additional life policy may be necessary to make up the difference and ensure your loved ones are provided for if you were to pass away. And if you took out a loan that your loved ones could be responsible for, you’ll want to know that you have enough life insurance to cover this new obligation.

5. You’ve added debt

Did you take on any loans over the past year? Things like home equity loans, or credit consolidation loans to lower interest payments. Those small shifts in your finances could possibly make a big difference when your loved ones are on a fixed income.

It’s always a good idea to bring an updated monthly budget to your annual life insurance review. Having a full scope of your finances can help provide needed relief to your beneficiaries.

6. Conditions have changed for your parents

Things may have changed for your parents, result in assisted living, or them moving in to your home. This could mean taking on a greater monthly financial load.

If this is true for your family, it's important to consider adding coverage for increased costs. You may also want to consider final expense coverage for your elderly parents at the time of your review.

7. New marital status

Few changes in your life will be bigger than a shift in your marital status. For the recently engaged or married, you’ll most likely want to be sure your partner is named as a beneficiary on your life policy.

This also applies to divorced or separated couples. Take the time to make sure your beneficiaries are up to date and reflect your wishes. When this step is overlooked, previously named beneficiaries could be legally entitled to funds you may want others to now receive.

8. Your kids are out on their own

As kids grow up, they move on. Often, though, that still includes your financial support; especially for students starting college. Keep their future secure by verifying your policy details. If your children are more financially independent, you may consider allocating benefits elsewhere.

9. Medical diagnosis

Health issues can emerge at any time and prompt a lot of sudden change. As complicated medical conditions progress, they tend to become more expensive. When reviewing life insurance policies, it’s a good idea to consider those future expenses and make sure you have funds available for treatment if a family member’s health has changed.

10. You recently bought a home

If you’ve recently closed on the purchase of a new home, that’s a change worth reviewing with your insurance agent. With a new mortgage in play, you’ll likely want your family to continue living there after your passing. Make sure your policy has the coverage amount and duration needed for your survivors.

Bundle and Save on Your Insurance

One more reason to review your life insurance? You may be able to score a discount!

If you have auto and homeowners insurance with American Family, and you buy a life insurance policy from American Family Life Insurance Company, you may be able to get a discount on your auto and home premiums.** Be sure to check in with your agent and verify your discounts are up to date.

Review Your Life Insurance Coverage Today

As life unfolds, circumstances may change. Because of that, so should your insurance. Be sure you're selecting coverage from a company with the flexibility to meet your needs.

Reach out to an American Family Insurance agent today to make sure your policy does exactly that. In addition to well-crafted life insurance, you’ll also have the peace of mind that comes with the knowledge that your loved ones are covered when they’ll need that coverage most.


*Available only at specified dates and life events and is subject to benefit amount limitations. See policy for additional details.

**Discounts may vary by state and company underwriting the auto or homeowners policy. Discounts may not apply to all coverages on an auto or homeowners policy. Discounts do not apply to the life policy.

Policy Forms: ICC17-223 WL, L-223 (ND) WL, L-223 WL, ICC17-224 WL, L-224 (ND) WL, L-224 WL


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Related Topics: Whole Life , Term Life , Buying Life Insurance , Cash Value