8 Life Changes That Impact Your Insurance Needs
Life offers plenty of joyful moments and milestones.
These events change your life in many different ways.
With all the excitement and transitions that occur, insurance is often the last thing on your mind.
These life changes can impact your insurance needs now and into the future.
If you’re in the middle of a transition, you may want to evaluate your insurance needs. Here are a few life events that may cause your insurance needs to change.
Here’s what we'll cover in this post:
Quick Article Guide
Here’s what we'll cover in this post:
1. Getting Married
Getting married is a big life change that impacts your insurance needs. You and your spouse will each need a life insurance policy to cover the burial and funeral costs in the case either of you pass away unexpectedly.
As of January 2022, the average traditional funeral service runs anywhere from $8,000-$10,000. This can be a financial burden if your spouse isn’t expecting this expense.
When it comes to covering your funeral costs, you have several policy options - including pre-need insurance, burial insurance, and final expense insurance. With burial life insurance, you can purchase a policy for $5,000 to $25,000. This life insurance is only intended to cover funeral costs.
Another option is to purchase pre-need insurance. Essentially, you prepay all of your funeral expenses upfront with this policy. You may need to select a funeral home, grave stone, casket, and other items to lock in a specific rate.
If you feel as though you need a little more coverage to cover additional debts or bills, final expense life insurance may be a good option. This form of life insurance helps you pay off additional expenses your spouse will acquire in the circumstance that you pass away. For example, if you have outstanding medical bills, it is a good idea to buy the extra coverage.
2. Switching Jobs
One of the many benefits of working for an employer is many offer different types of insurance. Some companies provide health insurance, disability insurance, and life insurance. When you decide to change the direction of your career, it’s important to review the changes to your benefits.
Reviewing your insurance benefits will help you determine if you need to purchase additional coverage.A lot of the time, group insurance does not meet your insurance needs. If you find your group, health, or disability insurance isn’t enough, you should research additional policy options to fill in the gap.
For example, you may discover your company only offers short-term disability insurance. This means that you will only have coverage for a limited amount of time if you were to become ill or disabled. If you encounter an illness or disability that lasts a lot longer, you will need extra coverage to fill in the gap.
3. Having Children
Once you have a child, it’s your responsibility to financially provide for them. If something happens to you, you want them to be financially secure and taken care of after you’re gone. Whether you share the financial responsibility with your spouse or you’re the sole provider for your family, you need a life insurance policy.
If you only want to protect your children for a certain amount of time, you will want a term life insurance policy. If you need to adhere to a strict budget, these policies tend to carry a less expensive premium. If you want to take care of your children for years to come or leave a lasting financial legacy, you may want to consider a whole insurance policy.
4. Purchasing A Home Or Rental Property
Typically, it’s recommended that you put 20% down on a new home. If you don’t have a 20% down payment, there are other options. If you don’t have a large down payment, some lenders will approve your mortgage as long as you purchase mortgage insurance.
This type of insurance minimizes the risk for lenders. Mortgage insurance provides payment if the borrower defaults on the loan.
You will also want to consider life insurance when purchasing a property. Your mortgage depends on your income, therefore, you may need additional coverage to protect your loan.
5. Paying Off Your Mortgage
Paying off your mortgage can impact your insurance needs. If you have additional life insurance coverage to protect your mortgage, you may want to decrease your policy. Contact your life insurance expert to discover options for lowering your coverage.
6. Getting A Divorce
Getting a divorce can be an extremely taxing event. You’re not only splitting your assets, you’re dividing your lives. This means that your insurance needs will drastically change.
If you end up receiving alimony or child support from your ex-spouse, you will need a life insurance policy to protect this support. If your ex-spouse unexpectedly passes away, you will want to assure you continue to receive financial support for your family.
Unfortunately, one of the biggest challenges when getting a divorce that involves children is that one parent often ends up taking on the majority of the financial responsibility of the children.
Many divorcees find they can’t rely on their ex-spouse once they have gone their separate ways. If you’re the sole provider for your children, it’s imperative you get a life insurance policy to protect them.
Acquiring a life insurance policy may increase your financial responsibility, but there are plenty of ways you can save money on your insurance rates.
7. Opening Your Own Business
Are you ready to take the leap into entrepreneurship? Starting your own business will require you to take on the responsibility of your insurance needs. Your previous employer will no longer handle your insurance requirements.
You will need to purchase health insurance, life insurance, disability insurance, liability insurance, and more. Navigating all of the different insurance options for business owners can be challenging. Partner with a business insurance expert to help you find the best policies to fit your many needs.
8. Entering Retirement
You may assume that once you retire you no longer need life insurance. If you have debt, plan to continue working, or have a disabled child, you should consider coverage.
You may first want to review your company’s sponsored plan to see if the policy is portable. It’s possible you can continue coverage without an exam.
If you find your insurance is not portable, you have plenty of other options. If you currently have term life insurance, you may be able to convert it into a whole life insurance policy. If you don’t have coverage you may be able to find a whole or term life insurance policy within your price range.
Please note, life insurance tends to be more expensive the older you are. That’s why it may be beneficial to buy a policy in your younger years to protect your family and assets.
The Bottom Line
As your life changes, so do your insurance needs. Every time you encounter a new life event, review your insurance policies. Taking a proactive initiative will allow you to protect your family from financial distress.
At JRC Insurance Group, our agents are experts with multiple years of experience. We are appointed by dozens of top-rated life insurance companies and our agents are not pushy salespeople.
Our agents do not have quotas; we’re here to help. We have helped hundreds of clients, and we can help you too. Our passion is finding our clients affordable life insurance coverage to protect their families.
Give us a call today, we would love to help! Toll free: 855-247-9555,or request a free quote here.