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life insuranceThe ultimate goal of anyone with a life insurance policy is to ensure that their loved ones are comfortable after they pass away. If you do not update your insurance coverage when changes occur in your life, you could leave your family without the benefits you intended. In order to determine what changes you should make to your life insurance coverage in 2012, consider the following.

  1. Are there any new family additions? If you’ve added people or pets to your family, then your cost of living increased. That means your family will need more in order to continue in the same standard of living after you’re gone.
  2. Did you relocate? If you’ve relocated then you have all new expenses, which may be more than those that you originally had when you took out your insurance policy and chose a death benefit.
  3. Have you been promoted? If you earn more money now than you did when taking out the policy, then your family will need a larger death benefit to replace that income after you pass away.
  4. How are your savings? If you have had trouble meeting your savings goals for emergencies, college tuition and retirement that may indicate that your heirs need even more financial assistance when they no longer have your income to rely on.
  5. Has your debt increased? If you’ve purchased a new home, new car, or even new electronic gadgets, then you may have increased the amount of debt your family needs to pay off after you pass away. Increasing your death benefit will allow them to more easily meet these obligations.
  6. What is the new cost of living? Inflation can increase the standard cost of living for your family. Consider how much inflation has affected the effectiveness of your current death benefit and make the appropriate increases.
  7. Who’s your beneficiary? Are the primary and contingent beneficiaries on your policy still the individuals who should be on your policy? Or, have you got a trust that should now be named on the policy?
  8. Will your heirs pay estate taxes? Estate taxes are back in effect. If your family will be expected to pay them based on the size of your estate, then it’s a good idea to increase your policy death benefit. If you’ve made your spouse the beneficiary, consider the fact that your death benefit, should you pass away prior to him or her, will be added to his or her estate later and may prompt estate taxes.

Your death benefit may face several expansions over the course of your life. These may be handled with the issuance of separate term policies or through increases of your main policy death benefit. If you want to discuss your options for gaining complete coverage for your family, give us a call.

Have more life insurance questions? Call Reliable Insurance at 713-227-7283 or get a Texas Life Insurance quote today!

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