Most people don’t have enough life insurance. But it’s not because of lack of trying.
Consumers just don’t realize that they need to re-evaluate their life-insurance needs whenever they have a major life change, an industry executive says.
“Life changes,” says Byron Udell, founder and chief executive officer of AccuQuote. “That’s why it’s extremely important to examine your needs at least every few years and certainly when big changes occur, like having a child.”
Udell points to five top life events that affect term insurance and would prompt a policy review:
Marital status. The first is a change in marital status – be it marriage, divorce or death. “Marriage comes with shared financial responsibilities. As a result, it is important to prepare for life’s uncertainties by purchasing sufficient life insurance for both spouses,” Udell says. “Alternatively, getting divorced or losing a spouse for any reason may mean less insurance coverage is needed.”
Children. Having a child is another significant life change that requires re-evaluation of insurance needs. Udell, who runs one of the largest term life insurance companies in the nation, says financial support is equally important as emotional support when raising a family. He advises parents to increase their coverage with each new child.
Home. Purchasing a new home is the third life event that would prompt an insurance-policy review, Udell says. “The best way to protect against costly mortgage payments should a breadwinner die is with life insurance,” he says. “Without it, a surviving spouse or loved one may not be able to afford the mortgage, as well as home maintenance, utilities and other unforeseen expenses.”
Income. As one’s paycheck increases, so should one’s life insurance, Udell says. Having a policy that equals 10 to 20 times one’s annual income is the best option, he says.
Retirement. The fifth top life event is retirement. When consumers begin planning for their golden years, Udell says, insurance should be part of the equation. Adequate coverage “can help consumers planning for retirement supplement their retirement income, preserve estate assets for their survivors and protect their loved ones financially should something devastating happen before retirement.”
For more information, visit the company’s Web site at www.AccuQuote.com or call 888-314-4455.