Life insurance is a crucial part of financial planning, providing peace of mind and financial security for your loved ones. But when should you consider adjusting your life insurance coverage? Here are some key life moments when it might be important to review your policy.
Expanding your family
Having children is a significant milestone that often prompts the need to review your life insurance. Ensuring your family is financially secure in the event of your untimely death may become a priority.
Buying a home
Purchasing a home is another critical moment. A mortgage is a long-term financial commitment, and life insurance can help cover this debt if something happens to you, ensuring your family can stay in their home while limiting the financial burden.
Career changes
A new job or a significant pay rise may also be a good time to reassess your life insurance needs. Higher income can often mean higher living standards and expenses, which could be reflected in your coverage. Conversely, a reduction in your hours or take home pay, might mean the need to reduce your expenses by reducing your cover.
Major investments
Making large investments, such as starting a business or investing in property, can increase your financial responsibilities. Life insurance can cover the debt of these investments and ensure they are not a financial burden on your family if you are no longer around.
Changing family
Family dynamics can change significantly due to events like divorce, remarriage, or blending families. Each of these situations would likely impact your financial commitments and potentially your life insurance needs.
Life insurance is not a one-size-fits-all solution. By reviewing your policy at key moments throughout your life, you can ensure your cover continues to meet your needs and provides the necessary protection for your loved ones.
If you need help to determine how much cover would be appropriate for your situation, we encourage you to reach out to a financial adviser who can recommend strategies for you having regard to your own personal circumstances.
It’s also a good idea to review your insurance at least annually, to ensure that it continues meeting your needs and your changing circumstances. And if for any reason you have issues paying your insurance premiums, reach out to your financial adviser or us to discuss your affordability options before cancelling your cover or letting it lapse, which could leave you and your family under or uninsured.
What you need to know
Resolution Life Australasia Limited ABN 84 079 300 379, NZ Company No. 281363, AFSL No. 233671 (Resolution Life) is part of the Resolution Life Group. The content on this website is for information only. The information is of a general nature and does not constitute financial advice or other professional advice. Before taking any action, you should always seek financial advice or other professional advice relevant to your personal circumstances. While care has been taken to supply information on this website that is accurate, no entity or person gives any warranty of reliability or accuracy, or accepts any responsibility arising in any way including from any error or omission.
