Overview
Reviewing your life insurance policy each year helps ensure the coverage still matches your needs and that there are no surprises for you or your beneficiaries.
Start by locating the one-page summary in your policy packet or online account and reading each line carefully.
If you want to explore other policy options or compare basic plan types, see Life Insurance for more details.
Key takeaways
- Check the death benefit and cash value for accuracy.
- Verify the policy term and any restrictions or waiting periods.
- Update riders and beneficiaries when life changes occur.
How it works
Most policies include a summary page that lists the policy type, the death benefit amount, any cash value balance, and notable riders or exclusions.
For permanent policies, the cash value grows according to the contract and may affect loans or withdrawals; know how it is calculated and reported.
If you prefer a policy with reduced underwriting steps, consider Simplified Issue Life Insurance which can shorten the approval process.
What it may cover (and what it may not)
The primary coverage is typically a death benefit paid to named beneficiaries if the insured dies while the policy is in force.
Permanent policies may also report a cash value component that you can borrow against or withdraw under certain terms.
Policies often exclude benefits for suicide within an initial waiting period, for deaths during excluded activities, or when premiums lapse, so read the restrictions carefully.
Common mistakes to avoid
- Failing to update beneficiaries after marriage, divorce, births, or deaths.
- Assuming the death benefit automatically keeps pace with changing income or debts.
- Overlooking required medical exams or waiting periods that could affect claims.
- Keeping riders you no longer need or missing useful riders that could add protection.
Questions to ask an agent
When you review your policy, ask how the death benefit was set and whether it still covers your current needs such as mortgage, education, or income replacement.
Ask how cash value is calculated and whether loans or withdrawals will reduce the death benefit or trigger fees.
Confirm the policy's term length or whether a conversion option exists, and whether any riders should be added or removed based on recent life changes.
If you want a quick next step, talk to your agent to review options and request any necessary adjustments.
Next steps
Set a recurring reminder to review your policy at least once a year or after major life events such as marriage, birth, divorce, or retirement.
Compare your current policy to other approaches for your stage of life and financial goals; this can include products tailored for older adults — see Understanding Life Insurance for Retirees for targeted information.
Keep records of any changes you request and confirm updates in writing to avoid misunderstandings later.
Frequently Asked Questions
How often should I review my life insurance policy?
Review your policy at least once a year and after major life events to ensure coverage and beneficiaries remain current.
What is the difference between death benefit and cash value?
The death benefit is the payment to beneficiaries when you die; cash value is a savings component in some permanent policies that you can borrow against or withdraw under the policy rules.
Can I change beneficiaries anytime?
Most policies allow beneficiary changes at any time, but check the policy terms to confirm whether a signature or notarization is required.
What should I do if I can't afford the premium?
Contact your insurer to discuss options such as reduced paid-up coverage, policy loans, or riders that might help manage cost; avoid letting the policy lapse without exploring alternatives.