Why Re-purchasing Your Term Life Insurance Before Expiration or Renewals Makes Financial Sense
Life insurance is one of those things we don't like to think about but know we need. For those with term life insurance policies coming up on their expiration or renewal date, you're at a financial crossroads with a crucial decision to make. A simple application could save you thousands, as holding onto an old term policy could cost upwards of 3x as much for the same coverage you could be eligible for today. Re-purchasing your policy before it expires can save you a significant amount of money and provide peace of mind. Here’s why.
Locking in Your Premium
Term life insurance is attractive because it offers a fixed premium for a set period. If you choose to purchase a new policy then cancel your old policy before it renews, you would likely lock in a similar rate. Waiting until after your policy expires or renews often means re-entering the market at an older age and probably paying significantly more due to age and assumptions of changes in health status. The insurance company can’t increase premiums if your health declines so they have to assume everyone's health will deteriorate. They are assuming if you are renewing your policy your health is likely a higher risk, this is why we re-apply to show the insurance company you are still in good health.
Avoiding Lapse in Coverage
A lapse in coverage can be risky. If your term life insurance policy lapses and something happens to you before securing a new policy, your loved ones may be left without the financial protection you intended to provide them. Re-purchasing before expiration ensures that there is no period without coverage. Always have new coverage in place before dissolving a renewable policy in the unfortunate situation of non eligibility or significant health declines. That would be a case where continuing with your policy will be more cost effective and sometimes your only option to continue coverage.
Preparing for Changes in Health
Your health can change unexpectedly, and with it, so can your eligibility for affordable life insurance. By re-purchasing your term policy in a timely manner, you take preemptive action against potential health issues that could make you uninsurable or lead to higher premiums.
Benefiting from Continuity
Having continuous life insurance coverage without having to shop around again saves time and ensures that you are always protected. It also means you can avoid the underwriting process again, which may become more complicated as you age.
Flexibility to Adjust Coverage
Re-purchasing your policy before it expires comes with the flexibility to adjust your coverage based on current needs. You may opt for a higher or lower death benefit or add riders that were not previously important to you.
Life insurance is a fundamental element of a sound financial plan, particularly for those who have others depending on their income. Re-purchasing your term life insurance before it expires is a strong financial move. It eliminates the risk of becoming uninsurable, keeps your premiums more manageable, ensures continuous protection for your loved ones, and provides the flexibility to adjust to life’s ever-changing circumstances.
We understand that insurance isn't just a policy; it's a promise. A promise to look after what matters most. If you’re a local resident or a current client nearing the end of your term life insurance, reach out to us. Together, we'll ensure your coverage continues to align with your life's journey. On the other hand if your policy looks good, you will have the peace of mind to know your finances are in a good position. Regular discussion about your policy will make you feel more secure and at times it can be advantageous to lower insurance if the needs have disappeared or decreased, a great example would be term insurance as a substitute for mortgage insurance, in the later years most of your mortgage will be payed off and you would be able to decrease the total death benefit and in turn your costs of insurance.
Don't wait until it's too late. The right time for peace of mind is now. Have a quick chat or a long one, we are here to serve your needs.
---
Considering revamping your term life insurance policy? Contact us for personalized assistance and professional advice tailored to your needs. Your family's financial future is important to us!