Based on the life insurance plans that you have opted for you could be getting coverage for a year or for all your life. This is based on the term of your life insurance plans. But if you have been having the same policy for quite some time then it is important to review it from time to time.
Your life as well as your insurance needs keeps changing. The same applies to the life insurance policy that you have. It is dependent on your personal life events and how you have evolved in your personal life that should be a step towards changing your life insurance coverage.
Did U Get Married? – Increase Life Insurance Plans Coverage
You may have life insurance plans and then you got married. Earlier you must have purchased the plan for some basic coverage or to save on tax. But now since you are married it is time that you make sure that the life insurance plans offers adequate coverage. You want to make sure that your spouse is able to meet his or her financial demands once you are not there. This is the time you may want to up your life insurance sum assured.
Ageing Parents- The Need To Increase Life Insurance Coverage
Your parents might have been healthy when you had first purchased the insurance plan. They may also be in full time jobs. But times have changed and now your parents are retired and they are also dependent on you now. This is the time you need to reconsider the life insurance policy that you have. If you are not there then your parents would be left with no support.
You Had A Child – It Is Time To Increase Coverage
The cost incurred in raising a child is huge today. From medical to schooling needs, the costs are only skyrocketing. You need to make sure that you are well insured to protect your child’s future needs. Else everything would be shouldered on your spouse that may make it difficult to meet your child’s requirements.
You Just Purchased A New Home
One of the primary reasons to buy a life insurance policy is to cover the house mortgage costs. It is used to pay for the expenses towards your home in the case of an eventuality. The last think that you would want is your family being forced out of their house because they were not able to pay the monthly EMI’s after you. So if you just purchased a house for you and for your family then make sure that you increase the assured sum amount to be able to pay off the home debt.
Your Income Has Increased
Your income is substantial but if your income was to get over then this could be a financial burden on your family. If your income has increase dramatically but you have not increased the insurance amount by the same percentage then if you are not around your family would not be able to continue with the same living standards.
Change In Your Lifestyle
With income comes lifestyle changes and if you think that your per month spending has risen then make sure that you proportionately can I increase my life insurance coverage insurance sum assured amount too.
Leaving Behind Something For The Family
You may wish to leave back some wealth for your family. The life insurance policy could cover for that.
Use A Comprehensive Calculator To Know How Much Insurance You Need Now
A comprehensive life insurance calculator will let you know whether or not you should increase the life insurance coverage. This will let you know whether it is time to review your insurance policy. You may either increase the coverage or buy a new one altogether. Reach out to the insurance company agent and see if he could offer a better deal on your policy that already exists.
Why Do You Need A Life Insurance Policy In The First Place?
The main reason why you have a life insurance policy is to eliminate any sort of a financial burden on your family in case you are not there anymore. This is particularly true if you are the main breadwinner of the family. When you buy a life insurance policy you are offering financial support to your family.
If you have a term insurance policy then it is a pure protection policy. The financial benefit is given to the nominees of the policyholder in the form of a lump sum payment or it could also be a regular payment based on what the customer has chosen.
It is important that you make sure that you opt for a coverage that gives adequate insurance in case you are not there. The sum assured amount is determined based on what the income and expense trend at your home is. It should also include the assets and the liability of your family and the goals of your family. The financial situation changes at each stage and thus it is important that you review your status and make changes to the life insurance policy as well.
Why Should You Have A Term Plan?
The main rule is that you need to ensure that your term insurance plan is active at least till you retire or at least till you have achieved your financial aspirations. This will offer you a peace of mind. The term plan offers a high coverage without charging a lot of premium and thus is suitable for policyholders.
It is important that you have a term insurance plan at every stage of your life but being clear on what your requirements for the future are and whether the plan offers you enough coverage.
Increasing The Sum Assured Value Of A Term Plan- Incremental Term Insurance
The sum assured amount how to increase sum assured that is fixed at the purchase of the life insurance plans cannot be changed during the tenure of the policy. It is thus important that you understand the coverage before you buy the term insurance plan. You could however increase the sum insured assured amount with the same insurer by choosing an option that lets you increase the sum assured amount. It is also important that you decide on the sum assured amount considering inflation.
There are also life insurance plans providers that offer life stage protection features. Here you can increase the term insurance sum assured amount at key stages of your life.
Maybe Buy Another Term Insurance Plan. What Is Term Insurance Plan?
You also have the option to buy an altogether new life insurance plans term insurance plan for your extra coverage needs. You however would need to do homework to check which comes out to be cheaper. The cost of the insurance plan is dependent on the age, lifestyle, occupation and the policyholder’s medical history. It will also be more expensive to buy a new policy as you age.
What Are The Advantages Of Increasing The Top Up Term Insurance Life Insurance Cover?
The key advantages why you should be increasing the life insurance cover offered are:
It is important to beat inflation
Inflation rate is increasing year on year and you need to opt for a coverage that helps to beat inflation. The term insurance plan lets you benefit from the inflation costs. You need to make sure that you keep increase the insurance coverage to beat the inflation rates. Else your family will not be able to benefit from the insurance lump sum payment as the amount will be very low in real terms.
Helps to meet the extra financial needs
Your responsibility and requirements keep changing with time. You were single and you did not need a lot of coverage. Then you got married, had kids, and had to shoulder the responsibility of your ageing parents. All this increased the need to increase the sum assured amount.
You thus need to review your policy to make sure that the sum assured amount is able to meet these expenses.
Insurance coverage is affordable- increasing cover term plan
If you have a term insurance plan then increasing term insurance the sum assured amount is very affordable. The premium does not increase by a huge percentage and thus this offers you enough coverage without pinching your pocket.
Extra saving in the form of taxes- term insurance plan with increasing sum assured
When you increase the sum assured amount then you will have to pay some extra premium amount. This lets you save additionally on taxes.
An Increasing Term Insurance Policy Is Appropriate For You
If you are a young individual but know that there are responsibilities that will come up in the future then opt for a plan that will increase the sum assured amount as your responsibilities increases. Also make sure that the plan is able to pay for inflation .Choose a plan that is an increasing life insurance plan where the coverage also increases with time.
The advantages of the increasing term insurance plan are many and there are many companies that sell this plan. It is your duty to check them well and do your own researches before you choose a plan that suits your needs.