Bought a life insurance policy? First, pat yourself on the back: Getting covered is a big step toward protecting those you love.

Life insurance provides an important financial safety net for many families, especially now. A recent study found that more people than ever recognize the importance of life insurance, with one-third of Americans saying they intend to purchase it in the next 12 months.

While buying life insurance is the most important step, you still don’t want to set and forget your policy once you’re covered. Your situation can change in an instant, so reviewing your coverage periodically helps make sure it’s giving you the protection you need.

When should I review my policy?

When you buy a policy, from term life to universal life insurance, you choose your coverage amount and make regular premium payments to keep it active. If you die while the policy is active, your family receives a lump sum cash payout, which they can use for whatever they need.

Managing your policy helps ensure you have the right amount of coverage for your financial needs and that your payout is still going to the right beneficiaries. In general, make sure to review your life insurance policy:

• After major life events. New babies, marriages, divorces, and promotions are all important times to take a closer look at your coverage. If your family is growing or you’ve just bought a bigger house, for example, you may need more coverage to maintain your lifestyle. New financial responsibilities, like caring for an aging parent, are also good reasons to take a second look.
• Once a year. Make reviewing your policy part of your regular financial housekeeping. An annual checkup can help you make sure the right person will receive your life insurance payout and that your contact and payment information are all still correct.

One additional reminder: If you have permanent life insurance, keep in mind that your policy builds cash value over time that you can borrow from. If you’ve tapped into your cash value, make sure to keep an eye on the balance, because any money you take out will have to be replaced so you get your full payout.

How can I update my policy?

Changes like updating your beneficiary or contact information are generally easy to do. With Fidelity Life, you can make them online or work with one of our agents.

If you need more coverage and just bought your policy, it may be as simple as filling out a form with your life insurance company. Otherwise, you might need to reapply to change your existing coverage. You can also increase your protection by “laddering” multiple policies. Since life insurance rates go up as you get older, this strategy can help you save on coverage. For example, if you bought a $250,000 20-year term policy 10 years ago, you can apply for a second $250,000 10-year policy and add it to the first. That will bring your total coverage up to $500,000 for the next decade and let you keep your original policy’s current rate.

Need help reviewing your policy? Our team can walk you through the process. Get in touch with a Fidelity Life agent today.

At Fidelity Life, our goal is to make life insurance simple, affordable, and understandable for everyday families. This content is intended for educational purposes only. Each post is carefully fact-checked, reviewed, and updated regularly to ensure the information is as relevant as possible.