Am I allowed to change my life insurance policy?
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Asked June 24, 2014
Some life insurance policies allow you to make minor changes to them, while others do not. Term life policies, for instance, are fairly straightforward and offer very little opportunity for making changes. Permanent life insurance policies might allow you to make some changes, but not many. In most situations, it is financially better to keep the policy as it is and simply add new policies for major life changes. For major life events, such as buying a home or having children, it is usually more economical to buy secondary policies than to change your primary coverage.
You may be able to increase the face value of a permanent life insurance policy. Since the policy remains with you throughout your life, insurance companies realize that some changes become necessary, such as changing your marital status, place of residence, etc. Some of these changes will result in lower rates; others will increase your premiums.
Before you make changes to your existing permanent life insurance policy, do some price comparisons to find out if you would be paying more than if you simply added a new policy to your portfolio. To do this, get a free online life insurance quote from this website for a policy that covers the new changes and compare that to the rates you are currently paying.
Buying a new policy works for you in another way. If the changes are related to something that has a time limit, such as buying a home or making sure your children will have college tuition, term life policies are usually better than changing existing permanent life insurance. Once the conditions of the new policy are no longer valid, you can let the policy expire without losing your entire coverage, or having to pay an excessive amount for the remainder of your life.
Answered June 24, 2014 by Anonymous